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SUPPLY SUPPORT OF AIR FORCE463L EQUIPMENT:

AN ANALYSIS OF THE 463L EQUIPMENTSPARE PARTS PIPELINE

THESIS

Brett A. GordonCaptain, USAF

AFIT/GLM/LSM/89S-24

a. DISTRI:UTIN STATEMENT A [or pi1

Approved for public releao;Disribution Unlimited ELECTE

DEPARTMENT OF THE AIR FORCE

AIR UNIVERSITY D 21

AIR FORCE INSTITUTE OF TECHNOLOGY

Wright-Patterson Air Force Base, Ohio

89 12 19 OOq... ,ml i I I II I I II8

The contents of the document are technically accurate, andno sensitive items, detrimental ideas, or deleteriousinformation is contained therein. Furthermore, the viewsexpressed in the document are those of the author and do notnecessarily reflect the views of the School of Systems andLogistics, the Air University, the United States Air Force,or the Department of Defense.

Acce:.son For

I&

A4

i I I'

AFIT/GLM/LSM/89S-24

SUPPLY SUPPORT OF AIR FORCE 463L EQUIPMENT:

AN ANALYSIS OF THE 463L EQUIPMENT SPARE PARTS PIPELINE

THESIS

Presented to the Faculty of the School of Systems and

Logistics of the Air Force Institute of Technology

Air University

In Partial Fulfillment of the

Requirements for the Degree of

Master of Science in Logistics Management

Brett A. Gordon, B.S.

Captain, USAF

September 1989

Approved for release; distribution unlimited

Acknowledgements

My greatest appreciation goes to my mother and father

for providing me with support in every thing I do. Thanks

also goes to my fellow transportation classmates for never

letting me give up even when the chips were down.

Appreciation is also extended to the personnel from

Charleston Air Force Base vehicle maintenance and base

supply, Warner-Robins Air Logistics Center, and the Defense

Logistics Agency for their time and patience in explaining

the supply pipeline to a novice like myself. Special thanks

to Charles S. Manns for providing unique insight into the

spare parts pipeline and to Majur Robert t. McCauley for his

efforts in pushing me toward finishing this thesis.

-Brett A. Gordon

ii/

Table of Contents

PageAcknowledgements.....................ii

List of Figures.......................v

List of Tables......................vi

Abstract........................vii

I. Introduction . . . . . . . . . . . . . . . . . I

General Issue............. . .. .. .. . . ....Background....................4Specific Issue..................6Research Objective................7Invest igative Questions..............7Scope and Limitations...............8Assumptions.....................Chapter Summary..................9

Ii. Literature Review..................11

Introduction..................11Supply Pipeline.................13Customer Service................14

Pipeline Cost Tradeoffs ............ 16Order Processing System ............. 19Order Entry and Processing Computers .... 25Order Cycle....................27Summary.....................29

III. Methodology.....................30

Introduction..................30Background ............................... 30Research Technique for InvestigativeQuestions One, Two, and Three...........34Research Technique for InvestigativeQuestion Four. ............................ 38Research Technique for InvestigativeQuestion Five..................38Summary.....................40

IV. Process Description................42Overview.....................42Background....................43Pipeline Overview.................44Vehicle Maintenance Processing ......... 45

NSN Requisitions...............50Part Number Requisitions (No NSN) . . . . 52

PageSupply Processing . . . . . . . . . . . . . . 54

NSN Requisitions ... ............ 54Part Number Requisitions ......... .. 58

Defense Logistics Agency Processing ..... .. 69NSN Requisitions ... ............ 74Part Number Requisitions ......... .. 76

Air Logistics Center Processing ........ . 77NSN Requisitions ... ............ 82Part Number Requisitions ......... .. 84

Summary ....... ................... 86

V. Analysis .......... .................... 88Introduction ...... ................ 88Overview ........................... 88Ownership of the 463L spare parts pipeline 89Pipeline Performance Measurements and Reports 93

Vehicle Maintenance .. .......... 95Material Control ... ............ .. 98Demand Processing and MICAP Control . 99Depot Performance Measures and Reports 100

Stockage Fill Rates .. ........ 101Depot Processing Times -Standards and Reports ....... 104

463L Pipeline Time Distributions ...... 108Source: The D165 weapon system computer 109Source: MAC Fo:ms 129 .. ......... 112Source: AF F::-itts 1823 . ......... 1!4

Summary ....... ................... 115

VI. Conclusions ....... .................. 117Research Conclusioe. .... ............ 118

Investigative Question One ........ .. 118Investigative Question Two . ...... 119Investigative Question Three ....... . 123

How is the process measured? . . 124Are these measures valid? ..... .. 125

Investigative Question Four ...... . 127Investigative Question Five ...... . 128

Further Research ..... .............. 130Summary ....... .................. 131

Bibliography ........ ..................... 132

Vita ........... ......................... 136

iv

List of Ficilres

Figrure Paae

1. System Interdependence...............3

2. Relationshir~s Within a Pipeline.........12

3. Pipeline Flow Process..............13

4. Cost Trade-Off Model................1

5. Order Cycle Distributions ............ 2

6. Pipeline Research Matrix............ 1

7. Generic Order Processing Flow..........33

8. Spare Parts Pipeline - General Flow ....... 44

9. Flowchart - Vehicle Maintenance.........46

10. Flowchart - Demand Processing..........55

11. Flowchart - MICAP Control............60

12. Flowchart - Defense Logistics Agtncy. ...... 70

13. Flowchart - Air Logistics Center ......... 79

14. DLA Pipeline Time Distribution..........110

15. ALC Pipeline Time Distribution...........ll

16. MAC Forms 129 - Pipeline Time Distribution .. 113

17. VDP Time Distribution..............114

v

List of Tables

Table Page

I. Functional Objectives Measurements ...... .. 91

II. Pipeline Time Measurements ... ......... .

III. Vehicle-Deadlined-for-Parts Data ..... 97

vi

AF IT./GLM/LStI/39S-24

Abstract

"'Cetting the right thing to the right place at the

right time," is the goal of a logisti-- system. With the

goal of the logistics system in mind, commanders and

managers are now asking what makes up a logistics system and

how does the system work? This thesis addresses these

questions by 5nalyziTg one pipeline within the Air Force

logistics system, the spare parts pipeline for 463L

equipment. This paper focuses on this pipeline for two

reasons: (1) parts availability for these mission assets is

essential to the Air Force; and 2) individual pipelines are

more manageable than the logistics system as a whole.

Through flowcharts and process descriptions this thesis

describes the organizations responsible for processing NICAP

spare parts requisitions for 463L Materials Handling

Equipment. Pipeline management, measurement, and

interactions are highlighted along with their impact on

pipeline functions.

The major outcomes of the thesis research were

(1) detailed flowcharts of the requisition process for 463L

parts from vehicle maintenance through the depots and back

to maintenance; (.2) an absence of responsibility for the

entire pipeline by a single manager or office; 13) key

pipeline measurements and management reports provided

vii

limited visibility over pipeline perfocmance, and ovurlooke

areas that degraded customer service; and (4) the order

processing system created inherent delays in the pipeline

because of outdated and indirect information systems and

technology. This research provides the groundwork for

future pipeline and logistics studies on pipeline

performance and measurement.

viii

SUPPLY SUPPORT OF AIR FORCE 463L EQUIPMENT:

AN ANALYSIS OF THE 463T MATERIALS HANDLING EQUIPMENT

SPARE PARrS PIPELINE

I. Introduction

Combat power equals the combination of combatoperations and combat support. Combat support isthe foundation of aerospace power... (4:3-6)

This opening quotation from the Air Force Combat

Support Doctrine clearly states the importance of combat

support or logistics to warfighting capability. In fact,

the ability of the logistics community to "Get the right

thing in the right amount to the right place at the right

time," is vital to achieving the principle of balance in

combat support (4:3-3). Logisticians achieve this movement

primarily through management of the supply pipeline. They

ensure the supply pipeline provides for the effective and

efficient flow of supplies and spare parts from point-of-

origin to point-of-consumption (34:6). If the pipeline is

managed improperly and operational commanders are unable to

get accurate supply status, they are unable to effectively

plan, support, and control operations (4:3-5). Thus,

improper management and incomplete knowledge of the supply

pipeline can diminish unit combat capability.

In order to manage and control the supply pipeline, it

is essential for logisticians and commanders to understand

I

the structure _f the pipeline. The supply pipeline is the

system of interdependent organizations, processes,

interactions, and information flows required to process

supply requisitions from inception, wheo, a requirement is

first izentified. to termination. (36:2). Each part or

element of this pipeline is also a system in itself and is

composed of its own subsystems (36:2). As a result,

managers and commanders must consciously define, select, and

understand the parts of the pipeline they control and

utilize.

f.w should systems be defined and analyzed? It depends

on the developmental level of the system. When the Air

Force supply system was maturing the predominant view tow ard

system analysis was the analytical approach (31:7). This

approach took a micro-analytic view and analyzed the

constituent parts of a system to gain a better understanding

of the system as a whole (31:6,7; 26:17). Years ago when

-organizations were not as complex as today," this

analytical approach served managers well (31:7). But as

organizations grew and researchers began to study the mutual

interactions of system elements, other methods of analysis

were developed thAt provided a more holistic approach to

analyzing large systems.

Today, in a time of increasing complexity, a macro-

analytical approach is used in systems analysis. With this

2

approach, organizations evaluate themselves as a whole

understanding that

a whole cannot be taken apart without loss of itsessential characteristics... [hence] instead ofexplaining a whole in terms of its parts, partsmust be explained in terms of the whole. (31:vii)

This macro-systems approach does not eliminate analytical

thinking, it only emphasizes that the essential

interrelaticnships between parts must be considered as well

(31:7). Now, "the systems analyst, instead of

'microanalyzing' the parts, focuses on the processes that

link the parts together" (31:7). Through macroanalysis,

managers note "that the input of one system is the output of

another system, and that the output of a system becomes the

input to another system,' as illustrated in Figure 1

(31:25). This diagram indicates a change in one

System's Boundary[Within organizational control]

•! r-7 From other systems To other systems 1 •Ii 0,O > Pi>nput Process Output

• L]Feedback - •

Figure 1. System Interdependence (31:25)

3

system or process effects all systems that foilow. Macro-

systems anaiy;' ognizes system changes do not occur

within a vacuum and a change in one system or process

affects other systems throughout an organization (31:7,8,9).

The Air Force supply pipeline is a system and can be

analyzed using the macro-systems approach. Because of the

wide variety of pipeline types within the supply system, it

is difficult to analyze all of the specific pipelines

involved. Consequently, this thesis concentrates on a

single pipeline type, the spare parts pipeline for 463L

Material Handling Equipment.10

General Issue

How well can the Air Force support and maintain its

463L equipment? Much has been observed and documented on

the necessity of adequate 463L support but, what process or

system has the Air Force actually developed to ensure this

equipment will operate when needed?

Background

Today's national strategic military policy of flexible

response is reliant on the ability to rapidly respond and

deploy forces to conflicts around the world. Rapid

deployment over long distances to conflict locations may be

accomplished only through massive airlift (28:14-15). For

example, a deployment of two F-15 squadrons to a bare base

operation in the Middle East will take nearly two weeks and

about one-quarter of the Military Airlift Command's (MAC)

fleet of cargo aircraft (28:17). Deployment requirements of

4

this magnitude place tremendous strain on tne airlift

system especially the cargo handling area which must

operate at full capacity for the system to work 16:6).

One key element of the cargo handling system is the

463L Material Handling Equipment (MHE) used in the movement

and preparation of air cargo. 463L equipment is essential

to the safe, effective, and rapid up and downloading of

cargo aircraft. This equipment, consisting primarily of OK

forklift, tiOK F/L), 25K and 40K cargo loaders (25K and i0K-

loaders), and elevated loaders, is the backbone of the

surface portion of the airlift system (23:6). Lt Col Gary

B. May emphasizes the criticality of 463L equipment in his

research report, The Impact of Material Handling Equipment

on Airliftppabilities, as he writes

Even if MAC had the airframes necessary toeliminate the airlift capability shortfalls, thenation could not deploy or sustain combat forceson a world-wide basis because of insufficientamounts of operable materials handling equipment[463L equipment] (25:70).

Lt Col May's reference to the availability of operable

MHE or 463L equipment was based on two factors: equipment

procuiement and positioning, and the vehicle in-commission

(VIC) rates of on-hand equipment. This research effort

examines the second factor and its impact on avaliability.

Equipment procurement and positioning are dependent on the

budget and needs of the Air Force, and they are beyond the

scope of this thesis.

With limited on-hand 463L equipment resources, it is

essential to maintain high in-commission rates to meet

5

deployment and mobilization needs. The necessity of

maintaining this equipment frequently is documented in cases

throughout the Vietnam conflict where the in-commission

rates ranged from 40 to 70 percent (25:70). In fact,

Brigadier General William G. Moore, then 834th ALD

commander said, 'our greatest limitation in the airlift

system now is the lack of MHE'" (25:7). The lack of MHE is

not necessarily driven by a shortfall of on-hand vehicles,

but primarily due to a significant lack of spare parts

(25:26,28: 16:7). As a result of the spare parts shortage,

the MHE system which was intended to increase airlift

efficiency and effectiveness actually constrained our

airlift efforts (16:7).

Past, present, and future dependency on airlift

dictates the Air Force support its 463L equipment to the

fullest extent possible. Spare parts supply is essential to

maintaining this equipment in operable condition. Thus, it

is essential to understand and control the spare parts

pipeline to provide the most effective means of getting the

right parts to the right place at the right time to support

the airlift mission.

Specific Issue

What organizations and processes make up the current

spare parts pipeline for 463L equipment, and how do these

organizations and processes affect the availability of 463L

equipment?

6

Research ,Ob ective

This thesis examines the spare parts supply pipeline

for 463L equipment to develop th flow pattern of spare

parts requirements from identification of need to receipt of

the part by vehicle maintenance. The flow chart developed

and processing time data collected are used to develop a

network design which may be used subsequently to show the

impact each part of the pipeline has on the pipeline as a

whole.

Investigative Questions

There are five major question areas examined in this

thesis.

1. What offices, sections, and organizations are

involved in the spare parts pipeline for 463L equipment?

2. What are the procedures followed by each section or

unit of the pipeline in the processing of spare parts

requisitions?

3. Who is responsible for monitoring the data

collected for the unit and for the system as a whole?

4. How are processing times recorded and what reports

reflect and summarize these times?

5. What are the average processing times and time

distributions for each section of the pipeline? How do

changes in the times and distributions impact the pipeline

time as a whole?

Chapter III will describe the procedures used to gather

this information and provide the results.

7

Scopel and Limitations

The supply pipelire analyzed in this thesis is limited

to the pipeline developed to process Mission Incapable

(MICAP) parts requisitions for 453L equipment. The MICAP

portion of the pipeline is studied because of the impact of

MICA? requisitions on airlift capability. By definition,

MICAP requests are initiated when equipment is inoperable

and the parts required for repair are not available through

base resources. Thus, MICAP requests for 463L equipment

reduce Air Force capability to conduct airlift missions and

create problems such as those experienced in Viet Nam.

This research is limited further by the type and

quantity of pipeline time data collected and management

reports used at Military Airlift Command (MAC) bases and

headquarters as well as, the Air Logistic Center (ALC) and

Defense Logistics Agency (DLA) depots. The data recorded at

these locations is not always as detailed as required for

network analysis, as many of the processing times record

only summary statistics which consolidate handling times for

a number of different functions. Also, vehicle maintenance

work order data is limited to work orders closed within 90

days of the date of research because of Air Force

administrative regulations.

As-sumptions

The major assumption made throughout the analysis is

that all organizations record time data in the same manner,

i.e. start and stop times are recorded at exactly the same

8

stage of the process. Although this assumption is highly

unlikely, the data gathered still provides useful

information for developing solid time statistics and

distributions for developing a network model. Another

assumption is that base vehicle maintenance and supply data,

although gathered from only one base, is representative of

processing times at all Air Force bases. Although this is

far to comprehensive to be valid, the use of Charleston AFB

as a model for the base level requisitioning process does

provide an example of how MICAP requisitions are initiated,

particularly at bases within MAC.

Ch-p ter Summary

This chapter provided an introduction to the supply

pipeline and to 463L equipment. it outlined the macro-

analytical approach to system analysis and the rationale for

using this approach when analyzing the supply pipeline. The

chapter provided a short history and explanation of the

importance of 463L equipment. Also included were the

objectives and research questions to be addressed in the

thesis along with the scope and limitations, and assumptions

of the thesis.

Chapter II provides a literature review of the order

cycle. Chapter III develops the methodology used in the

research. Chapter IV draws a detailed outline of the spare

parts pipeline process for 463L equipment MICAP parts

requisitions to provide answers to the first two

investigative questions posed in Chapter 1. Chapter V

9

-a zcllected and reponds to the last three

-estions. Finally, chapter V draws

the analysis and provides topics to be

-irther research.

10

II. Literature Review

Introduction

The logistical process does not end... when theproduct is turned over to the next level in thedistribution channel... (the] ultimateresponsibility for logistics does not end untilthe product in question is finally accepted bythe.. .enterprise that will use it. Therefore, toproperly direct the logistical activities,planning horizons must transcend the totaldistribution channel. (2:88)

What is logistics? Within the military, logistics is

often referred to as "the bridge between the industrial base

and the armies' (29:15). And, the JCS Pub I defines

logistics as

the science of planning and carrying out themovement and maintenance of forces. In its mostcomprehensive sense, those aspects of militaryoperations which deal with: a. design anddevelopment, acquisition, storage, movement,distribution, maintenance, evacuation, anddisposal of material... (39:1-1)

This definition encompasses the broad range of functions

required to support combat forces (39:1-1). This description

is much broader in scope than its business logistics

counterpart. Logistics management, as described

commercially, relates more to the physical distribution and

materials management aspects of the military definition than

to its design, development, and maintenance aspects. The

Council of Logistics Management defines logistics management

as

the process of planning, implementing andcontrolling the efficient cost-effective flow andstorage of... goods and related information from

11

point-of-origin to point-of-consumption for thvpurpose of conforming to customer requirements.

(34:7)

This definition refers to the flow of goods and information,

a flow resembling what the military refers to as the supply

pipeline. Because of the similarity of the business

definition of logistics and that of the pipeline in the

military, the remainder of this literature review will use

the terms supply pipeline and pipeline to refer to what the

commercial literature terms logistics.

This literature review will describe the make-up of a

supply pipeline, an order processing system, and an order

cycle using the following relationships. Conceptually,

Figure 2 shows how the supply pipeline encompasses the order

processing system which, in-turn, encompasses the order

cycle. With this model in mind, the review will discuss the

customer service aspects of a pipeline followed by a

logistics cost tradeoff model. The scope of the review

SUPPLY PIPELINE

ORDER PROCESSING SYSTEM

ORDER CYCLE

Figure 2. Relationships Within a Pipeline

12

then will focus on the order processing sub-system of the

pipeline by describing each component of this sub-system.

Finally, the literature review will describe the order cycle

and how it relates to the pipeline as a whole.

Supply Pipeline

The supply pipeline provides a system through which

products and information flow between suppliers and

customers. Many sub-systems or functions make-up the

pipeline including: order processing, transportation,

warehousing, inventory control, distribution communications,

and procurement (34:7). But, as products and information

move through the pipeline, the traditional boundaries

between functions are transcended and each individual

function becomes part of a smooth, efficient, and effective

process for meeting customer requests. (10:4,25). Figure 3

provides an example of how the channel assimilates the

individual functions and transcends their boundaries.

-- > Order Processing 1--> Warehousing -- > ITransportation --

Individual Functions

v

-- > Order Processing Warehousing Transportationl-->

Process

Figure 3. Pipeline Flow Process

Without a smooth flowing, integrated pipeline, a firm

may never achieve its strategic goals (2:267). Therefore,

13

appropriate organization and control of the pipeline

supports the mission of the enterprise as a whole rather

than the individual goals of the sections within the company

(10:25). 'To be effective, a pipeline must attain [the]

levels of performance in each of its component functions

which together achieve the goals of the enterprise' (2:274).

This strategic orientation acknowledges business is not

solely concerned with the use of inputs but the creation of

outputs; therefore, it is logical to think and manage in

terms of outputs first and inputs second (10:25).

Customer Service

'The single output of any organization is customer

service. Customers, not managers or products, drive the

organization" (10:11). Therefore, a company's pipeline

performance is measured in terms of customer service levels.

Pipeline service depends on three factors: product

availability, delivery capability, and information

communication (34:100).

Availability refers to a supplier's ability to provide

the customer with the product ordered. Availability results

from a firm's stockage policy, where a greater level of

inventory generates greater customer service levels because

it reduces the potential for stock-outs (10:410). A stock-

out means a product is not available when needed, and can

result in lost sales depending on how a customer evaluates

the stock-out event (32:282). In other words, a customer's

reaction to a stock-out depends on his perception of product

14

availability which incorporates both objective and

subjective components (10:18). Objective availability

reflects a supplier's actual ability to fill customer

orders, whereas subjective availability represents the

impression of a supplier's service that a customer develops

over time (10:17). 'The point being that the more often a

[pipeline] is perceived as being out of stock, the more

likely the customer" will switch suppliers (10:17,18).

Pipeline capability constitutes the second factor used

in determining a pipeline's customer service level.

'Pipeline capability results from the design and

dependability of the components that make up' the order

processing system of the pipeline (2:274). Capability

reflects the level of customer service provided by a

supplier expressed in terms of the time lapse between the

placement of a customer's order and its physical delivery,

commonly described as order cycle time (10:5). This measure

relates to both the speed and consistency of delivery times

(37:39). Delivery speed refers to the length of the average

or stated delivery time: whereas, delivery consistency

refers to the frequency and magnitude of deviation between

the average or stated delivery time and the actual time of

delivery, in other words, order cycle variability

(34:501,502). A good supplier not only offers prompt

deliveries, but also consistent deliveries (37:39).

Communication is the third and final factor to affect a

pipeline's level of customer service. Communication between

15

a supplier and a customer usually refer- tc a supplier's

ability to provide timely and accurate product information

and order status (34:101). Product information alludes to

the information a supplier provides a customer prior to the

submission of an order and can include: produ.t

specifications, prices, availability, and substitutability

(34:101). Order status relates to information provided to

the customer after an order has been placed. Order status

normally includes order acknowledgement with an expected

delivery date (EDD), timely and accurate order sta-us

updates, and order tracking information (10:76). The

overall level of customer service provided by a supply

pipeline depends on the pipeline's ability to provide the

right product or information to the right place at the right

time (34:11).

Pipeline Cost Tradeoffs. As stated earlier, a

strategic business orientation acknowledges business is not

solely concerned with the use of inputs but the creation of

outputs, so it is lgical to think and manage in terms of

outputs first and inputs second (10:25). Once pipeline

managers evaluate and determine the service level outputs

required to satisfy and maintain the firm's customer base,

management then strives to achieve an economical balance

between this pipeline performance and its input costs

(2:274). The key to realizing the most efficient

combination of inputs is through a total cost analysis of

the logistics operation. In a total cost analysis,

16

management strives tc minimize the total cost of logistics

rather than the cost of each individual logistics activity.

(34:45) Included in this total cost analysis, management

evaluates the organization, control, and goals of each

section of the pipeline to ensure they are operating at

levels optimizing the performance and cost effectiveness of

the enterprise rather than optimizing their individual

operations (10:25). "To be effective, a pipeline must

attain levels of performance in each of its component

functions which together achieve the goals of the

enterprise" (2:274).

To meet the goals of the firm, it might be necessary to

sub-optimize operations in some logistical functions to make

the entire pipeline more effective and efficient (10:4).

Figure 4 provides a cost trade-off model which illustrates

the complex interactions of logistics activities which

combine to provide customer service levels. The lower

portion of this model illustrates why pipeline costs and

activities are evaluated in terms of flows, and why total

cost and output of the pipeline depend on the efficiency of

the interactions among all logistics activities (10:23).

By simply following the arrows, one realizes that a

change in any logistics activity will impact the output and

flow of the entire system. For example, if a firm decides

to reduce the number of warehouses in an attempt to reduce

17

P'OCuc'

P r c e P oPro m o tio n 5

Place-Customerservice leveis/

Igren 4.Coorad-foe (rno3127

carrying c os i cosisU r7Ta s

experinced eforethe cange (34:o11312)

e euati g Cost Trade-Offs maeen3 aso2 us

cosierthe costsoae wthe lot or foegon saless

processing

e x p e i e n c d b e o r e h e c a n g e i n f o r m a t io n)

F ig vaue i ng Cost Trade-Off Md e en a(so:1us)

inetry caryi costs, sated wothel r foreigoequale

atv, suc as trnprtto or ore prcesig IInI

resulting from reductions in customer service levels (34:45;

32:281,282). The costs of lost sales are particularly

apparent when evaluating warehousing decisions.

'Reducing the number of warehouses to reducewarehousing costs can act as a double-edgedsword ... [along with reducing costs]. It reducesthe ability to provide response to customers onshort notice when needed and perhaps even moreimportantly, it reduces the customer's perceptionof the suppliers' ability to respond." (32:283)

In many cases, a customer reacts to this reduction in a

supplier's real or perceived ability to respond by changing

suppliers. Thus, the resultant loss in sales and revenues

offsets at least part of the savings acheived from reduced

warehousing costs (10:18). The most important thing for a

pipeline manager to remember is there is a difference

between the lowest cost alternative for a logistics activity

and the lowest cost/most profitable alternative for the

pipeline and organization as a whole (32:294).

Order Processing System

The raison d'etre of the distribution system of acompany is to fulfil customer orders .. Thedistribution manager should know the actual path(not necessarily the same as the official path)taken by customers' orders within his own company.Then by using this information to produce a flowchart of this path, the distribution manager is inthe position to undertake a careful analysis ofthe flows and thus to identify "problem areas."By tackling these problem areas, the distributionmanager may expect to speed up the entire order-handling process, which will reduce the overallorder cycle time. The principle difficulty oftenencountered is that order processing may crossseveral different functional boundaries within acompany, many of which are outside the coiatrol ofthe distribution manager. (10:73)

19

In order to evaluate the performance of an order

processing system, a manager must first have a basic

understanding of the system and its components. This

section begins with an overview of the order processing

system and its effect on the supply pipeline. Following

this general description, the specific components of a

typical order processing system are described.

'The order processing system is the nerve center cf tiie

logistics system' (34:499). The order orocessing system

serves as a network for transrniting order information and

transactions that link customers to suppliers (34:505). In

essence, tbc order processing system provides the medium,

witihin the supply pipeline, through which customer orders

flow from order preparation to order delivery (2:274;

34: 505).

Information flowing through the order processing system

activates the physical distribution process and may precede,

accompany, or follow the actual movement of material (21:32;

35:142). The speed and quality of the information flow

directly impacts pipeline capability to efficiently process

orders and satisfy customer demands (21:32). Information

delays or inconsistencie slow pipeline processes and

increase total distribution costs (34:519; 10:73). Total

costs increase because any delays within the order

processing system require suppliers to carry additional

inventories and/or use premium transportation to maintain

customer service levels (10:73). Thus, the effectiveness of

20

an order processing system directly impacts the cost and

efficiency of the supply pipeline (21:32).

Each component of the order processing system

contributes to the overall effectiveness of the supply

pipeline. Thus, understanding the components of the system

is essential to managing the pipeline.

A typical order processing system consists of c.

following components: (1) order preparation and

communication, (2) order entry and order processing,

(3) order picking and packing, (4) order transportation, and

(5) customer receiving (34:499,502). Each component

contributes to system performance.

The first component, order preparation and

communication, begins when a buyer decides to place an order

initiating both the customer service cycle and order

processing system (15:58; 34:505). "The customer order

serves as the trigger that sets the physical distribution

process [pipeline] in motion" (21:32). The quality of the

information submitted in a customer order impacts the cost

and efficiency of the entire processing system, so it is

essential customers possess the latest product data and

specifications prior to submitting their orders (34:499:

15:58). More accurate orders increase the efficiency of the

order processing system.

Once ai, order is prepared, 'order transmittal should be

as direct as possible," since it is the order which sets the

logistics system in motion (34:505). Orders transmitted

21

electronically, rather than manually or via mail, minimize

the risk of human error and decrease order transfer times.

Electronic order transmission provides the most accurate and

rapid method of getting the order to the supplier, and the

more accurately and quickly a requirement reaches a

supplier, the sooner the order is processed (34:503,505).

The second component, order entry and order processing,

starts when the supplier receives a customer's order. It

begins with various checks to determine the priority and

acceptability of the order. Upon receipt, orders normally

undergo the following sequence of events:

(1) Orders are sorted according to processingrequirements such as immediate orders ....(2) Orders are vetted to ensure that all data arein computer-acceptable form.(3) Information on the order form is validated byinterrogating the computer files. Product [andorder information] accuracy is also checked.(4) Orders are screened against customer creditlimits. Accepted orders will be passedon ... [while rejected orders will be held orreturned](5) Valid orders are provided with a uniquereference number and passed on for either on-lineor batch processing. (10:75)

Once the order is entered into the system, the order

processing function begins. This function is not to be

confused with the order processing system. The order

processing function is a component of the order processing

system and constitutes the supplier's internal "activities

associated with the assignment and commitment of inventories

to orders" (2:132).

Order processing requires the flow of order information

from one department to another, as well as from one

22

logistics function to another. (34:518). Order processing

provides both the internal and external information required

to fill orders and provide customer service. Order

processing generates internal information which provides

such internal business documentation as: invoices for

accounting, inventory updates for inventory control, picking

instructions for warehousing, and shipping instructions for

transportation. External documentation generated for

customer use includes: inventory availability, order

acknowledgements, expected delivery dates, and back-order

information. A suppliers ability to rapidly generate

accurate internal and external information directly effects

the efficiency and customer service levels achieved through

the order processing system. Together, order entry and

order processing form the largest portion of the pipeline

that is "controlled" by the supplier. (34:500,505)

The third component of the order processing system,

order picking and packing, involves retrieving materials

from inventory and preparing them for use at other locations

(35:132). "Unless material is stored ready for shipping, (a

supplier] must pack the item for protection against movement

hazards," as well as mark the item with appropriate shipping

data (35:133). Warehousing and packaging can substantially

reduce problems related to speed and ease of movement

through the system' by storing products in a manner that

requires the least amount of handling (2:25). Reduced

23

handling increases the efficiency of the total physical flow

of a product and, thereby increases the efficiency of the

pipeline (2:25).

The fourth component of the system, order

transportation, involves the physical movement of the

product from the supplier to the customer and ccntributes

place utility to the pipeline (3:7). Order transportation

accounts tor the largest portion of the time an order spends

in the order processing system (34:500). "Transportation is

[also] the highest single cost area in most logistical

systems" (2:157). Because of the large portion of pipeline

time and costs associated with transportation, it is

essential to consider all transportation strategies when

conducting a total cost analysis of the supply pipeline

(3:42). A reduction in either transportation time or cost

can have a dramatic effect on the order processing system

and the pipeline (35:169)

The fifth and final component of the order processing

system is customer receiving. Receiving includes the

physical handling of incoming shipments, identification of

material, verification of quantities, and the routing of the

material to the location or department where the item is

needed (35:129). This last component is primarily

controlled by the customer; but, any change in the order

processing system that increases the ease of in-checking an

item contributes to the level of customer service provided

by the pipeline.

24

Order Entry and Processing Computers

Order entry and order processing have benefitted

greatly from the application of electronic and computer

technology (34:506). So when conducting total-cost

analyses, pipeline managers should evaluate the capabilities

of the three major types of processing systems: batch, on-

line, and computer-to-computer (CPU-to-CPU) systems (21:33).

Batch entry processing systems encode all order data

transmissions on a magnetic tape for mass order processing

at a time beyond when the actual order is recorded (21:33).

Using batch systems has two major drawbacks. The first

drawback involves the batch order entry process. This

process does not allow "up-front validation, of customer

order information." Without up-front validation input

errors and product availability status are not known until

orders are processed by the next batch input cycle. The

second drawback involves the inherent processing delays of

batch processing systems. Depending on the frequency of the

batch entry cycles, an order may be held on record but not

processed for hours. This drawback can delay customer order

feedback on order errors and product availability for hours

or days. Thus, the outdated methods of data capture and

transfer used in batch processing systems reduce the

efficiency and service levels of the total order processing

system (21:33).

On-line order entry and processing systems improve both

internal distribution efficiency and customer service

25

levels. On-line systems allow for immediate entry of

incoming customer orders. Each order is entered immediately

upon receipt eliminating delays inherent in batch entry

systems. On-line systems feature:

On-line ordering; validation at the time of inputfor stock items and customer information; real-time inventory update--when an order is processed,inventory is adjusted immediately: on-line accessto order, customer, and inventory data; ... andcommunications from distribution centers to thecentral processing computer for access andmaintenance to order, shipping and inventory data.(21:33)

On-line systems also enable a supplier's customer service

-epresentatives to provide quick and accurate over-the-phone

order status, inventory checks, and shipping data to any

customer inquires (21:30). Overall, on-line systems for

"order placement and entry have the potential for

significant reductions in order cycle times," as well as,

significant increases in customer service levels (21:33).

The most advanced order entry and processing systems

combine order preparation, transmission, entry, and

processing by using computer-to-computer, CPU-to-CPU, order

processing systems (34:506-517). These systems locate

computer terminals in customer establishments which provide

customers with interactive access to a supplier's main

inventory and order processing computers. CPU-to-CPU

systems enable customers to directly interrogate a

supplier's inventory to determine product availability,

place and modify orders, and obtain up-to-date order status.

(34:506-517) In all, CPU-to-CPU systems can increase

26

customer service levels and lower total system costs by

increasing customer-supplier interaction, and eliminating

order entry and processing redundancies (34:510,511).

Order Cycle

The order cycle is the elapsed time from when a

customer prepares an order to the time the customer in-

processes the product. Order cycle statistics reflect the

average flow times and time variations orders encounter as

they pass through each of the five components of the order

processing system, as well as the system as a whole. The

purpose of these statistics is to provide pipeline managers

with a quantitative method for evaluating the performance of

the order processing system and its components. (2:46,47,95)

A good' system not only provides rapid delivery times

but also consistent delivery times (37:39). Customers

frequently value consistent delivery times over fast

delivery since it is commonly accepted that rapid delivery

provides little value if it can not be achieved consistently

(10:17: 2:27). Because customers prefer consistent

delivery, one of the goals of pipeline managers is to reduce

order cycle variability (2:46).

Order cycle statistics enable pipeline managers to

determine if and where variations in the order processing

system occur. Figure 5 illustrates a typical example of how

order cycle statistics are reported.

Each component of the system has its own unique time

distribution. These distributions represent the average and

27

range of processing times an order can experience as it

passes through the respective components. These statistics,

allow managers to evaluate the effect of each component on

total system performance. With this information, managers

can identify problem areas in the system and concentrate

their efforts toward reducing order cycle time and

variation. (2:274,275)

FreauencyI

2 O,er entr r and orocessrg

3Tnie range eduencvI o 5 days

3 Order oiccng or droducvOn

2me 'ange ,'ecuencyto 3 days

4 Transcoraion

:me range7o 9 days

5 Costomer receving

3Time range

Frequency I to 5 days

TOTAL2

Time rangeFrqec1 !o 3 days

5 davs 15 25 days

Figure 5. Order Cycle Distributions (34:502)

28

Summar,

This literature review provided information focused on

explaining the make-up and purpose of the supply pipeline.

The review began by explaining how the military supply

pipeline parallels what commercial literature refers to as

the logistics system. Then the function of the supply

pipeline was explained along with its relationship to

customer service. Subsequent discussion focused on

explaining the functions and components of order processing

system along with thier relationships to the pipeline. The

review then described the three types of order processing

computer systems and their drawbacks and capabilities.

Finally, the review concluded with a description of the

order cycle and its reflection of the performance of the

order processing system.

29

III. Methodology

Introduction

This chapter describes the techniques used in

collecting the data required to answer the investigative

questions posed in Chapter I. These questions stem from the

research objective of analyzing the 463L equipmen- spare

parts pipeline.

Background

"Before determining what a logistics system should be,

we need to find out what it is." (19:269) Oscar Goldfarb,

the Air Force Deputy for Supply, Maintenance, and Logistics

Plans, posed a similar statement in a memorandum concerning

pipeline studies. Mr. Goldfarb suggested the first step in

studying supply pipelines is "to collectively define the

pipeline and piece together what information is now

regularly collected and used by managers" (12). This

information would provide the insight as to what the

pipeline is, and provide an indication as to what the

pipeline should be. (12; 19:269) This thesis provides the

first step in determining what the pipeline is now. Rather

than trying to document a generic supply pipeline, this

thesis concentrates on documenting a specific pipeline

within the supply system, the pipeline for 463L equipment

spare parts. The goal in attempting to document this

particular pipeline is to address the specific issue

presented in Chapter I, that of, "What organizations and

30

processes make up the current spare parts pipeline for 463L

equipment, and how do these organizations and processes

affect the availability of 463L equipment?" Documentation

of this pipeline provides one step in the direction toward

describing and documenting the Air Force supply pipeline as

a whole.

The approach to the pipeline research conducted in this

thesis follows Gomes' total system/conceptual approach

described in his article, "A Systems Approach to the

Investigation of Just-In-Time." This article presented a

2x2 matrix describing the approaches and analytical levels

of research conducted in Just-In-Time (JIT) systems (14:78).

This model was specifically applied to JIT delivery systems,

but it also can be extended to pipeline studies in general.

(See Figure 6)

Research Approach

Conceptual Empirical

Non-Level Systemof

Analysis TotalSystem

Figure 6. Pipeline Research Matrix (Adapted from 14:79)

"This matrix suggests that research can be categorized

according to two factors, (1) the researchers' approach and

(2) the level of analysis used." (14:78) The researchers'

approach refers to either a conceptual, concept buildi ..g

31

study or an empirical, hypothesis testing study. These

studies are conducted at either of the two levels of

analysis described in Chapter I: the micro-analytical/non-

systems level, examining the functioning of system parts;

or, the macro-analytical/total systems level, focusing on

both the parts of a system and their interactions (14:78).

As discussed in Chapter I, the total systems approach

provides the most effective means of analyzing the complex

processes of today.

This thesis uses the total system/conceptual approach

to describe the pipeline for 463L equipment spare parts.

The framework for conducting this pipeline research follows

the generic flow of requisitions through the order process

described in Chapter !I and illustrat,d in Figure 7. This

research begins in the base vehicle maintenance section,

where the customer initiates the order, and progresses

through the order process back to vehicle maintenance, where

the part is delivered. The flow of the order through each

organization involved in the order process is documented to

illustrate the path of a requisition from start to finish.

When describing and documenting a process, like the pipeline

for MICAP parts, several key questions must be asked:

1) What is the flow of the process?2) What are the boundaries of the process?3) Whoowns the process?...4) What are the objectives of the process? Howis the success of the process in meetingobjectives being measured?5) Are the measurements being taken on theprocess valid? (11:42)

32

CustomerCutmrSiorder delivery customerordeer

Order

Frnsigure 7ac Gnrc order PrcsIngvowi(4:04

7nvento-ry--Iavailable

documen Inventory Process

C'Th e), -f ig warehouseOr mre check florer withdrawal

SCaptoer I.il q r

J/ L_. Production ..

schedlule

L e scion aransorta,on I scnedung

Figure 7. Generic Order Processing Flow (34:504)

Responses to the-e questions provide descriptions of the

organizational responsibilities, relationships, and

procedures required to better understand and improve the

documented process (11;41-42,5""-53; 19:294).

The following investigative questions were presented in

Chapter I.

1. What offices, sections, and organizations areinvolved in the spare parts pipeline for 463L

equipment?

33

2. What are the procedures followed by eachsection or unit of the pipeline in the processingof spare parts requisitions?3. Who is responsible for monitoring the datacollected for the unit and for the system as awhole?4. How are processing times recorded and whatreports reflect and summarize these times?5. What are the average processing times and timedistributions for each section of the pipeline?How do changes in the times and distributicrsimpact the pipeline time as a whole?

They correlate well with the key questions posed by Gitlow.

Therefore, by integrating Gitlow's questions with the

investigative questions of Chapter I the research will

document the pipeline process and provide managers of the

463L spare parts pipelie with a better understanding of the

system in which they operate and control. Most importantly,

the research provides an answer to the specific issue

presented in Chapter I. The specific methodology used to

answer the investigative questions follows.

Research Technique for InvestigativeQuestions One, Two, and Three

The first three investigative questions posed in

Chapter I,

1) What offices, sections, and organizations areinvolved in the spare parts pipeline for 463Lequipment?2) What procedures are followed by each section orunit involved in the pipeline in the processing ofspare parts requisitions? and3) Who is responsible for monitoring the datacollected for the unit and for the system as awhole?

were answered through a combination of literature review and

personal interviews.

34

Since the objective of answering the initial

investigative questions was to define and outline the spare

parts requisitioning process, the research began with a

review of base level transportation and supply manuals, AFM

77-310 and AFM 67-1 series manuals, respectively. These

manuals provided information concerning functional

operations and requisitioning procedures. Review of the

regulations was followed by an in-depth examination of the

base level organizations involved in the spare parts

pipeline.

Personal interviews were conducted to provide the

detailed information needed to fully develop the flow of

MICAP requisitions through base level pipeline

organizations. These interviews were conducted with

technicians and supervisors in the vehicle maintenance

section and base supply squadron of Charleston AFB, SC.

Charleston AFB was chosen for study because it provided an

example of the spare parts pipeline developed by the primary

user of 463L equipment, Military Airlift Command (MAC).

Personal interviews were used as the primary method of data

collection because this survey technique provided an

interactive format for probing into the topic (9:160).

Further, use of this technique provided the most in-depth

and detailed information about the topic under study

(9:160).

All depot level processing information was received

through personal interviews with experts at both the Warner-

35

Robins Air Logistics Center (W-R ALC) for details on the Air

Logistics Center depot system, and the Defense Construction

Supply Center (DCSC) and Defense Electronics Supply Center

(DESC) for details of the Defense Logistics Agency depot

system.. Interviews conducted were with the following:

Branch Chief, Materials Support Branch, Section Chief, MICAP

Support Section, Supply Systems Analysts, and Equipment

Specialists at W-R ALC and with the Supervisor, USAF

Expedite Section, Emergency Supply Operations Center (ESOC)

at both DCSC and DESC. The information gathered through

these interviews were the sole sources of information

concerning depot level processing procedures. No literature

reviews supporting the interviews were conducted because the

highly technical publications governing depot processing

were far too vast to be adequately reviewed during the

course of this research.

The locations chosen for the personal interviews were

selected on the basis of their involvement in the 463L MICAP

pipeline. Charleston AFB incurred a relatively large number

of MICAP requirements, with) respect to other Air Force

bases, as reported in the Military Airlift Command's weapon

support computer system. DLA depots satisfied approximately

85 percent of the MICAP requisitions reported in that same

MAC system. Finally, W-R ALC was chosen for both their

depot support for 463L equipment as well as their

responsibility as the primary servicing ALC for vehicles.

36

Once the data was collected, flowcharts were developed,

using the EasyFlow software program, to illustrate the

processes, procedures, and organizational interactions

involved in the spare parts pipeline. The flowchart

provided 'a pictorial summary of the sequence of operations

that made up the (order] process." (11:45) Flowcharting

also provided a means for breaking down the requisition

process into its component parts and highlighting the

interactions necessary to successfully document the pipeline

(11:53).

The flowchart and processing information developed from

literature reviews and personal interviews were then

validated. Validation was achieved through feedback. After

each section of the pipeline was constructed through

flowchart and narrative constructs, the constructs were

reviewed by the expert technicians and supervisors to ensure

the flows and procedures were represented accurately. Each

flow was reviewed by more than one expert to limit the

amount of personal bias that may occur during any personal

interview survey (9:166).

The validated flowchart was used to analyze the MICAP

pipeline. As indicated in Chapter I, the macro-analytical

systems approach breaks a system into its components and

then reassembles the parts to provide a better understanding

of the system, concentrating particularly on the

interactions between and within the components. Documenting

the pipeline through flowcharting provided the means to

37

analyze this system using the macro-system approach and

better understand its operation for use in improving the

process (11:53). In accomplishing this analysis, the

experts were asked to point out any differences between the

official pipeline, as described by regulation, and the

actual pipeline, the process used in daily operations. The

responses of the experts were combined with the recognized

differences between the official pipeline and the "ideal"

pipeline outlined in Chapter II, and reported in Chapter V

of this thesis.

Research Technique for InvestigativeQuesticn Four

The fourth investigative question, "How are processing

times recorded and what reports reflect and summarize these

times?" was researched through the same personal interview

method used for questions one through three.

The research examined the reports cited by the pipeline

technicians and managers as being the primary management

tools used in managing the pipeline for MICAP requisitions,

and any other reports which isolated 463L MICAP requisitions

from other types of requisitions. The reason for selecting

these reports was to focus the research on only those

reports used in the actual management of the 463L spare

parts pipeline.

Research Technique for InvestigativeQuestion Five

The fifth and final investigative question was broken

into the following two parts: "What are the average

38

processing times and time distributions for each section of

the pipeline?" and 'How do changes in the times and

distributions impact the pipeline time as a whole?' Each

part was addressed separately, but the answer to the second

question was dependent on the answer to the first question.

Determining the processing times for each section of

the pipeline was dependent on finding supporting

documentation which would provide a sufficient database from

which to develop analytical charts. These charts were

designed to, reflect a distribution of order processing times

for each section involved in the order process. These

distributions were to be combined into a simplistic

simulation model to be used to determine the impact of

changes in the individual processing time distributions on

the processing time distribution of the pipeline as a whole.

The simulation model then would have provided pipeline

managers with a tool for evaluating the affects of changes

in the individual sections' processing times on total

pipeline flow.

The random, disaggregated, and functionally oriented

methods of data collection failed to produce a complete set

of time distributions as desired. However, analysis of the

pipeline time distributions developed from the processing

times available was conducted to illustrate the difference

in distributions developed from the different data sources.

39

Summar-y

This chapter began by restating the investigative

questions posed in Chapter 1 and compared these questions to

a set of questions whose answers are considered essential to

documenting any type of process. It was shown how the two

sets of questions were similar, and that by addressing both

sets of questions simultaneously the 463L spare parts

pipeline process would be adequately documented.

The chapter then provided the techniques and

methodologies used to research and document the 463L spare

parts pipeline. As explained, the primary technique for

researching each of the investigative questions was to

conduct personal interviews with knowledgeable technicians

and managers of each section of the pipeline. The

information gathered was used to develop a flowchart and

process description outlining the entire order process of

the spare parts pipeline, particularly the processing of

MICAP requisitions.

Each of the key pipeline measurements and management

tools was then determined, again through personal

interviews. These interviews also provided insight into

what factors were actually being measured and recorded in

the pipeline management reports. This information was used

to evaluate the performance measurements themselves.

Finally, this chapter presented the intended technique

for developing a management tool that could have been used

40

to evaluate the affects of changes in the order processing

time distributions of each individual pipeline unit and the

pipeline as a whole.

Chapter IV takes the first part of this methodology and

develops the actual flow of a MICAP requisition through the

463L spare parts pipeline. Chapter V addresses the

performance measurement evaluation and presents an analysis

of the pipeline order processing time data collected during

the course of this research.

41

IV. Process Description

Overview

This chapter provides the first step in conducting a

macro-analytical analysis of the 463L equipment spare parts

pipeline. The chapter begins with a general diagram of the

organizations that constitute the 463L parts pipeline and

illustrates how the different parts of the pipeline interact

through their inputs and outputs. Following the general

pipeline diagram is a series of flowcharts and process

descriptions of the major components of the pipeline. These

charts and descriptions illustrate the different routes

parts requisitions follow as they flow through the

components of the pipeline.

In describing the flow, this chapter also addresses the

first two investigative questions posed in Chapter I:

--What offices, sections, and organizations are

involved in the spare parts pipeline for 463L

equipment? and

--What are the procedures followed by each section or

unit involved in the pipeline in the processing of

spare parts requisitions?

These two questions closely parallel the first of Gitlow's

key questions to documenting a process, "What are the

boundaries of the process?" and "What is the flow of the

process?" (11:42) As a result of the similarity of the two

sets of questions, providing an answer to the investigative

42

questions also provides the first step in documenting the

463L spare parts pipeline.

Background

This analysis primarily concentrates on the portion of

the 463L equipment spare parts pipeline involving the flow

of requisitions for vehicles in Vehicle Deadlined for Parts

(VDP) status. This status signifies that vehicles cannot

perform their intended mission because of broken or missing

parts which are not available from on-base stocks or

resources. Thus, any 463L equipment in VDP status reduces

the air cargo handling capability of the Air Force.

The Air Force realizes the critical nature of 463L

equipment and lists this cargo handling system as a Mission

Capability (MICAP) reportable system. As a MICAP reportable

system, any requisitions for parts causing a VDP condition

for 463L vehicles or equipment receives a MICAP reportable

Standard Reporting Designator (SRD) code. This code

identifies requisitions as high priority and facilitates

processing of the requests through a series of specialized

procedures designed to expedite the handling of the order

and reduce the total down time of the equipment. MICAPs

essentially create a special channel within the spare parts

pipeiine through which high priority requisitions flow.

This channel provides the focus for the following

description and analysis.

43

Pipeline Overview

The 463L MICAP pipeline consists of four major

organizational components: Vehicle Maintenance, Base Supply,

and two depot systems - the Air Logistics Centers (ALC) and

the Defense Logistics Agencies (DLA). All of these

components combine to form the spare parts pipeline. Figure

8 illustrates the general flow of requisitions through the

pipeline.

AirLogistics

I i CentersVehicle -> Base _ _ __

Maintenance Supply J<

Defense> Logistics ,--

Agency

Figure 8. Spare Parts Pipeline - General Flow

As shown, requisitions originate in Vehicle Maintenance and

are passed to Base Supply. Supply then processes the

requisitions and transmits them to either an ALC or DLA

depot. The depots further process these requisitions and

either send the requisitioned parts or transmit requisition

status back to Base Supply which, in-turn, passes the parts

and/or status on to Vehicle Maintenance to complete the

order cycle.

Using this general flow as a reference, the next four

sections of this chapter describe the internal flows and

processes of each of the major components. To best follow

44

and understand the process descriptions of the components,

it is suggested the reader follow the flow diagram in the

referenced figure for each component. Following the path of

the flow provides a visual frame-of-reference for the

processes described in subsequent sections.

Vehicle Maintenance Processing

Spare parts requisitions for 463L vehicles are initiated

in the vehicle maintenance shop, but a number of processes

and decisions nust take place prior to submitting a MICAP

requisition. The determination as to whether or not a

vehicle is placed in VDP status and an accompanying MICAP

requisition initiated depends on the need and availability

of parts from local or base resources. The processes used

to determine part availability and eventually initiate

VDP/MICAP conditions are flowcharted in Figure 9 and follow

the logic outlined in the process description which follows.

The entire process begins when a piece of 463L

equipment enters the maintenance shop in an out-of

commission condition. When a vehicle is checked into

vehicle maintenance, Maintenance Control and Analysis (MCA)

initiates a AF Form 1823, Vehicle and Equipment Work Order,

to document the labor and parts required to repair the

vehicle. At this time, MCA also assigns the vehicle a

Vehicle-Down-for-Maintenance (VDM) coding. A vehicle

mechanic then receives the work order and analyzes the

vehicle to determine the cause of vehicle failure. If the

45

TRiE 463L SPAREPAR7S SJPPLY

O-o-C,.~sonMe hanc required' Te, T0 A

F ROM

B

cannb ali tionthrughTO C

Figure 9 Flowchrt

Veicle Mantnac

Ye6

DemandProcess

NSM or Material Telephone DemandPa ' t number NSN Controlchecks inq"iry Processing

A reqU13 , Lion, info , records Checks pase -0part order in resources for

shop log part

Part'art

um me r

Conduct Initiate DOthorough part For. 1348-6 YesP

rn.mbe r -Include ------------ -- MICAP) 70 Fesea ch detailed par

10 info

V.0

Send 01) FORM1348-6 toDemand

Processing; Donot expedite

B FROM

Request Annotate VOPVMO/VM5 Approval yeg approval and

C approval to granted? start time, TO Hgo VOP "orkorder to

Mat Control

No

No

Follo. VMO/VMSPart

in;0truc.tions,available') nd r r che

<

alternatives

y es

D - P TO I

Figure 9. Flowchart - Vehicle Maintenance (Cont.)

47

Demand M1at Contra!oracessing receives part,

airects parts annotates log, TO J3issue and notifies

mechanic

Maera Mechani

kilontork eitkorin to~ O

1348-64t

Status reportedto MaterialControl

-VOP reportedto MCA

RequisitionL to MICAP

Control

Mat Control MCA annotate*receives part -orIkorder JON.

N from base and schedulessupply and vehicle for

notifies MCA grepair

MICAP RpiQAE0 control '-~complete orkorder.

release vehicle

P

Figure 9. Flowchart -Vehicle Maintenance (Cont.)

49

failure repair does not require parts, the mechanic makes

the repair and returns the vehicle and workorder to MCA.

For repairs requiring parts, the mechanic identifies

the necessary parts and researches vehicle Technical Orders

(T.O.) and microfiche part number/National Stock Number

(NSN) cross-reference listings to determine the correct part

numbers and NSNs required to order the parts through the

supply system. The mechanic records the part numbers and

NSNs on the work order. If no NSN is found to correspond

with a part number, the mechanic lists the part number and

T.O. references on the work order. The mechanic then

submits the workorder to the Material Control section of

vehicle maintenance (33).

"Material control is the liaison between the

maintenance and supply systems and manages supply

transactions for (vehicle) maintenance." (7:47) As such,

Material Control receives all parts requests from the

maintenance shops on the AF Form 1823. The material

controller then reviews the work order to determine whether

or no- all the parts required have associated NSNs.

NSN Requisitions. When workorders have NSNs

listed for all of the part numbers, Material Control

conducts cursory checks for any obvious errors in the NSN

and calls the Demand Processing (DP) unit of base supply

with a fill or kill request. The fill or kill procedure

provides the material controller with an immediate response

as to the availability of parts from base stockage (30). If

50

the parts are available, the controller records a "fill" for

the requisition and orders the part (33). Material Control

monitors the order to ensure the part is delivered (7:47).

If the parts requisitioned are not available through

base stockage, Material Control annotates a "kill" for those

parts and returns the work order to the mechanic (33). The

mechanic notifies his supervisor of the "kill" and turns the

work order over to MCA. MCA and Material Control then check

the possibility of acquiring the part from vehicles being

processed for salvage. If the part is available, the

mechanic takes the part from salvage and repairs the vehicle

in the shop (7:47,105).

If no parts are available from salvage, MCA checks the

possibility of cannibalization. Cannibalization is the

process of taking a part off of a vehicle already down for

extensive maintenance and placing the part on the vehicle in

the shop to make it mission capable again (7:105).

"Cannibalization is used only when the deadline of the

vehicle seriously affects the user's mission" (7:10). So,

if the part is available through cannibalization, MCA or

the material controller submits a cannibalization request to

the Vehicle Maintenance Officer (VMO)/Vehicle Maintenance

Superintendent (VMS) or, in the case of 463L equipment, to

MAJCOM for approval. In most cases, the VMO/VMS has the

authority to approve the cannibalization of parts, but "all

major components and assemblies cannibalized from critical

assets" must be approved by the owning MAJCOM (7:10). 463L

51

equipment is a critical asset, so some requests for

cannibalizing 463L parts are required to be routed through

the MAJCOM before the part is removed and used. Once MCA

receives approval, the mechanic cannibalizes the part and

repairs the vehicle, thus averting a VDP/MICAP condition

(7:27).

If all of the preceding possibilities have been

considered and no parts are found to be available, MCA

submits the workorder to the VMO/VMS for approval to place

the vehicle into a VDP status. Upon approval, MCA properly

annotates the AF Form 1823, Vehicle and Equipment Work

Order, with the VDP start time (7:27). This "VDP time

starts when the VMO/VMS confirms that parts or material are

not on-hand." (7:86) MCA then returns the work order to the

material controller who monitors the requisition until the

part is received.

Part Number Requisitions (No NSN). If only part

numbers are listed, the material controller cross-checks the

part number against the microfiche cross-reference lists.

If the cross check does not match an NSN to a part number,

the controller along with the mechanic, if necessary, lists

any T.O.s, page and figure numbers, Sources of Supply (SoS),

and other reference information that list or identify the

part. The material controller then writes this information

on a DD Form 1348-6, DoD Single Line Item Requisition System

Document (Manual-Long Form), and carries the form to Demand

Processing for further research and processing (33). If

52

Supply crosses the part to a valid NSN, DP notifies Material

Control and processes the requisition as an NSN fill or kill

request. If an NSN is not found, DP passes the requisition

to the MICAP control section of base supply (27). Material

Control then receives notification of the requisition status

and annotates the vehicle workorder with a VDP status and

start time, and passes the AF Form 1823 to MCA (33).

When 463L vehicles go VDP, Material Control assigns the

proper MICAP reportable SRD codes to parts requisitions, and

calls Demand Processing to place the MICAP part on

backorder. Material Control monitors the-D18 report,

Priority Monitor Listing, for the status of the MICAP

requisition until the parts arrive at vehicle maintenance

(30). Because of the high priority and visibility of MICAP

requisitions, Material Control verifies the status of MICAP

parts daily to ensure the status and Estimated Delivery

Dates (EDD) of the parts requisitions are consistent with

the needs of the user. If Material Control receives "bad"

status or notices the EDD is extended or exceeded, the

controller reports the change to both the MICAP section of

supply and the VMO (7:24,47). If necessary, Material

Control develops a mission impact statement, with inputs

from the organization owning the equipment, and provides it

to MICAP Control to initiate a supply assist request on any

requisitions for which the supply status and/or EDD fail to

meet mission requirements (40).

53

When Material Control receives the requisitioned part,

the controller notifies MCA, which concurrently takes the

vehicle off VDP status, places it in Vehicle-Down-for-

Maintenance (VDM) status, and schedules the vehicle for

repair (7:27).

Supply Processing

Material Control provides the input to the next portion

of the pipeline by either phoning or walking MICAP part

requisitions to the Demand Processing section of base

supply, as indicated in Figure 10. Phone-in requisitions

are either NSN or part number requests.

NSN Requisitions. For NSN call-in requisitions,

the Material Controller provides Demand Processing (DP) with

the NSNs and SRD codes for the required parts along with

other required organizational and funding information.

Demand Processing records this information on an AF Form

2005, assigns the requisition a document number, and enters

the demand into the Standard Base Supply System (SBSS). The

initial demand is processed on a "fill or kill" basis. If

the part is in-stock, DP reports a "fill" to Material

Control and processes the requisition through the computer.

The SBSS generates a DD FORM 1348-1, DOD Single Line Item

Release/Receipt Document, with an 02 Priority which directs

the warehouse to expeditiously pick the order and send it to

the delivery section. The delivery section then delivers

the part to Material Control within 30 minutes. (27)

54

material 2e~and Technical

Control PnOnel pr~cesstflc research Tor al~sSR: conducts T

requxs.n '0, ~ . MICAP in-deptih cross-

SupyEocedite reference check(

Pa - t FOM 3

Dersan ?rcesSr, requisition TO

Fiuei. Focat-Demand Processing u .i'odaarc-e

GEED-on A FOR 255

ResarcaDean

Crossed No assigns a Processingto valid oally a gaan TO ENSN I) enerate d document

>st-ccx

number

number

BYes

Processing FI/,1 3ackorder Yes

S assigns r tacxorc ,er IC TO F

document number request7

to requisition :

Fil"/ No

FROM

Part C

from base5 oc agel

Yes

OP tries to Stockc Controlcross-reference orders partto other NSNs. + Fill from depot if TO Hsubs. higher none due-inassy or kits

ComputerYes generates AF

MICAP' FORM 1348-1 TO Iwith expedited

pick & delivery

Figure 10. Flowchart - Demand Processing (Cont.)

56

AF FCRM 1348

passed toMICAP Control

Cross-check SOMCP Ys FORM 2005 toI SN an, , C eRrao MAC FORM 129, MICAP Control

for accuracy Supply MICAPCheclizst

sends supply initiates IAassist Follow up andCeto

.message to supply assistdepo t mess age

N 0

Material O rComputer

Control reevd Ys generatesH - monitors ihnED routine AF

order status <FORM 1348-1

Pikpr nsend to Deliver part

"delivery to Materialqectlon Control

Figure 10. Flowchart - Demand Processing (Cont.)

57

If the part is not in-stock, Demand Processing attempts

to cross-reference the NSN to a different in-stock NSN,

suitable substitute part, next higher assembly, or rebuild

kit that may be used tc repair the vehicle. If an alternate

NSN is found, DP contacts Material Control and asks if

vehicle maintenance will accept the alternate part. If the

alternative is acceptable, the alternate NSN is recorded on

a AF FORM 2005 and processed through the computer as any

other NSN requisition. If no alternate NSN is found or

vehicle maintenance does not accept the alternat6 NSN, the

requisition is "killed" and reported to Material Control.

(27)

Part Number Requisitions. For part number

requisitions, Material Control conveys the request by

telephone or sends a courier with a non-NSN requisition DD

Form 1348-6, DoD Single Line Item Requisition System

Document (Manual Long Form) to DP. If the request is

received over the phone, DP requests the part number and

T.O. references along with any other part information that

will aid in locating and/or procuring the part. DP records

this information on a DD Form 1348-6 and passes the

requisition to the Research Section of supply alerting

Research to any MICAP requests. The research section then

conducts an in-depth cross-reference check in an attempt to

find a valid, stock listed, NSN for the requisitioned part.

This check includes researching T.O.s, microfiche cross-

reference listings, and if available, computerized part

58

number cross-reference data bases that access information on

all valid DoD part numbers and NSNs. If the check crosses

the part number to an NSN, the NSN is recorded on the

requisition and processed as an NSN request. If the in-

depth check does not cross the part number to an NSN,

Research assigns the part number a locally generated stock

number and returns the requisition to DP for a document

number. At this time, DP also initiates a MAC FORM 129,

Supply MICAP Checklist, and annotates any checks already

conducted on the part and its availability. DP passes thp

MAC FORM 1.9 and DD FORM 1348-6 to MICAP Control for further

pro essing (27).

When Material Control submits NSN requisitions for

backorder, DP records the request on an AF Form 2005 and

again checks to ensure the SRD is valid and MICAP

reportable. DP transcribes the order information from the

AF FORM 2005 to a MAC FORM 129 and turns this MICAP

Checklist over to MICAP Control for further processing (27).

MICAP Control receives the MAC FORM 129 and, if

required, the DD FORM 1348-6 and conducts a series of checks

to find the most expedient means of acquiring the parts

required. Figure 11 illu9trates the procedures followed by

MICAP Control 41n processing MICAP requisitions. For part

number requisitions, MICAP Control calls or sends a message

to the depot's Customer Service or Part Number Requisition

department and provides the part number information from the

5-

LrnterrequisiLtion

: mn nto supply TOAPr~ccomtputer.

annotate 129

Yes

Pact Noer S stockage Part NMAP Control requisiti~on? through ava~iaole9 TO 3

Figur 11. lowchrt - inqui Cntro

ema'0c' 'r0

Computer Part Pickea Part d eiveredgenerates CD Oy areouse o Material

A i ORM 1348-1 and sent to Control eithonPrLority 02. del, ery 30 minutes

output to whse

SerNc at Part Check lateral.3 2er l iet n9 depot 11-stocx

9 TO C

tFg chec .art -hC C ro

Order MCAP

Input order

Update base Assign BAsupply status statuscomputer in ba se supply

co mputer

Yes

N~o RepneMonitor 049,

adqae)MICAP Status

Report

-Ca I depot No Part Yes

Customer arrived" 10T Drvice

and/or 1M

Figure 11. Flowchart - MICAP Control (Cont.)

61

Transmit Call depot for

C --o, Available for backorder hours after TO Ethrough depot orderrequisition order status 48

transmitted

Yes

Order fromlateral supportbase -Ship FMA

or renuestOvernight ship

Moni t a rstatus

< Part

received No Updatewithin 5 > part/shipment

days, status

Yes

Yes

PartFollow-up located/ No

------------ I- L_ Trace another partshipment shipped9

TO F

Figure 11. Flowchart - MICAP Control (Cont.)

62

OrderSttsPrStatus/EOO Yes aid EDO Yes eevee

£E- ava, amle9 adeq~a~e 10 Monitor daily ithin EDDI

'do

Foll -upsubmi&t supply-Contact depot assist, supply No ]espons.

service ind/orhihrHmetu r:for tatu~ssuprned

Figure~~supl 11Mlwcat- IACCnrl Cn.

63eviganoae

DD FORM 1348-6 to the depot for further research. MICAP

Control then awaits a response from the depot.

If the depot does not provide a message response within

a specified time period, determined locally by the MICAP

Control section, the MICAP controller calls the depot for

follow-up information concerning the requisition. When the

depot response is received, MICAP Control checks to see if

the part number was crossed to an NSN. If so, MICAP Control

follows the procedures for processing NSN requisitions

outlined in the next paragraph.

If the part number was not crossed to an NSN, the

servicing depot provides instructions detailing an

alternative means of satisfying user demand. MICAP Control

evaluates the depot instructions for satisfying the demand.

These instructions can vary from waiting for the depot to

establish a contract for the procurement of the part to

cancellation of the requisition and authority for the base

to locally procure or manufacture the part, if possible. Tf

the instructions meet the requesting organization's mission

requirements, MICA? Control follows the instructions that

most expeditiously satisfy the requisition. If the depot

instructions do not meet the mission requirements of the

user, MICAP Control sends the depot a Supply Assistance

message, with a mission impact statement provided by the

user, requesting additional parts support or expedited

delivery dates (40).

64

When MICAP Control receives NSN requisitions from DP,

MICAP Control processes the request by first re-checking the

base supply computer to ensure the part is not available

through any on-base assets, including war readiness material

or spares kits. This check also searches for suitable

substitutes or higher assemblies that may satisfy the

requisition (40). Depending on local procedures, MICAP

control may request Storage and Issue to conduct a visual

check of the storage area of parts normally stocked on-base

but were reported as out-of-stock by the supply computer.

If the required part is located, the requisition is

processed through the computer which generates a DD FORM

1348-1 with an 02 priority. The 02 Priority signifies the

part must be delivered to the requestor within 30 minutes

after reception by the supply delivery section. (40)

When a part is not found on base, MICAP Control checks

off-base parts sources. The MICAP controller begins by

calling the customer service section of the servicing depot

to check on the availability of the part through the depot.

If the part is in-stock, the controller orders the part

immediately. The controller then assigns a BA statLI, item

being processed for release and shipment, to the requisition

and inputs this information into the supply computer. MICAP

Control monitors the D41, MICAP Status Report, daily until

the MICAP is in-processed by the receiving section of base

supply. When the part is in-processed, the computer

automatically terminates the MICAP and updates the D49

65

report to reflect the termination. MICAP Control then

annotates the termination time on the MAC Form 129 (40).

If the part does not arrive within a locally specified

period of time, the MICAP controller calls the Customer

Service section of the depot or the IM of the NSN to find

out why the part is delayed. If the controller receives a

response from depot adequate to meet mission requirements,

determined by MICAP Control and the requesting organization,

he updates the requisition status in the SBSS and monitors

the parts arrival through the D49 report (40). If the

response does not meet mission requirements, MICAP Control

cancels the requisition and follows lateral support

procedures. In these cases, the depot requisition must be

cancelled prior to going lateral support because of

guidelines presented in AFM 67-1 that state, depot requests

and lateral support requests cannot be conducted

concurrently for the same requisition (8:17-11).

In cases where the part is not in depot stock, MICAP

Control checks the possibility of getting the part from

other bases through lateral support. To check lateral

support, the MICAP controller reviews the Stock Number Users

Directory (SNUD). The SNUD lists all Air Force bases which

use the NSNs referenced in the directory. The controller

contacts the bases listed as using the required NSN. If the

part is available from one of these bases, the controller

orders the item from the owning base.

66

The lateral support base ships the part by the fastest

means available (FMA). Once ordered, the controller enters

the requisition status into the SBSS and monitors the D49

report until the part arrives at base supply. If the part

does not arrive on base within locally determined period of

time, about five days for FMA shipments, MICAP Control

contacts the lateral support base to find out why the part

is delayed (40). If the part has been shipped, MICAP

requests the sending base trace the shipment to find out why

the delivery is delayed. Once the part arrives on base and

is in-processed by supply, the MICAP is terminated and the

part delivered within 30 minutes (40).

When a part is not available through lateral support or

lateral support arrangements fail, MrCAP Control backorders

the part through the servicing depot. MICAP Control

normally backorders parts through a computer-to-computer

autodin transmission network. MICAP Control monitors the

D49 report for a status and EDD on the requisition. If no

status is received within 48 hours of the order, the

controller calls the depot's Customer Service section to ask

for status on the requisition. If order status is received,

MICAP Control enters the status and EDD into the SBSS. The

MICAP controller then monitors the D49 report daily until

the part is received and the MICAP terminated.

If Customer Service cannot provide an answer, the

controller will contact the Item Manager (IM) responsible

for that NSN for a reply. Once the controller receives a

67

status and EDD on a requisition, MICAP Control and Material

Control evaluate the status and EDD to ensure they are

consistent with mission requirements. If status and EDD do

not meet mission requirements and the controller fails to

receive a satisfactory reply from the IM, MICAP Control

initiates a supply assistance, supply difficulty, or higher

headquarters support request to explain the mission impact

of the problem and request assistance in resolving the

problem. (40)

When the controller receives a "good" or adequate

status and EDD on a requisition, he monitors the D49 report

daily. If the part is received by the EDD, the controller

enters the MICAP termination time on the MAC Form 129 and

files the checklist for 30 to 60 days (40). If the part is

not received by the EDD, the controller calls the depot to

find out where the part is and why it is delayed. If he

receives an adequate reply, the controller will update the

requisition status in the SBSS and monitor the D49 report

daily until the part arrives or again exceeds its EDD. If

MICAP Control does not receive a "good" answer, the

controller initiates either a supply assistance, supply

difficulty, or higher headquarters support request in an

attempt to expedite the processing or acquisition of the

part required (40).

In summary, the base supply Demand Processing and MICAP

Control sections ccnstitute a significant portion of the

463L spare parts pipeline. The input which initiates supply

68

processing is the requisition submitted to DP by the

Material Control section of vehicle maintenance. Supply

then proceeds with its order processes and provides either a

part to vehicle maintenance or a requisition to another

portion of the supply pipeline. Thus, Supply receives

inputs from Material Control, processes these requisitions,

and provides outputs to other parts of the pipeline. With

this pipeline interdependence, any problems or difficulties

within one portion of the system affects many other

processes, and performance of the system as a whole.

Defense Logistics Agency Processing

MICAP requisitions from base level MICAP Control

sections are the inputs to the depot portion of the spare

parts pipeline and enter either the Defense Logistics Agency

(DLA) or Air Logistics Center (ALC) depot system. Within

the DLA and ALC systems, depot facilities manage specific

types of parts and equipment grouped together into what are

referred to as Federal Stock Classes (FSC) (24). The first

four digits of an NSN identify the particular FSC of the

part and specifies the depot which receives and processes

the requests for the part (24). Approximately eighty-five

percent of the MICAP depot requisitions for 463L parts fall

under the purview of DLA depots and follow the process flow

diagrammed in Figure 12. Requisitions following the ALC

process flow are described in the subsequent section.

69

TaDe input

M,'CAP Recorded an into c omputer

Control magnetic tape 3 times per TO A

da Y

Autodin

qt -er 5ourc:t0ata

MICAP part Aut din Te eDhone ervice Autom 1 0 n

(requisition b from < Telephone Reccrded Xeypunch dbase Supply Message anall on into comp!te,

OLA FORM 934

Message

Manually

Requisition transfer data

Processing to DLA FORM -j

Center 934

Figure 12. Flowchart Defense Logistics Agency

70

Standard

, " tomated < 14 SN 0 > 1.4 S N Part YesA ma t 0 r i a 12 Pa r t if in-stack9 70 B

ManagemontSystem

Pa t NoNl,;mr3er

Transmitted I.,

DLSC forcross-referencagainst aster

'00 i 13 t ingS

Y 3 No

Dem >

treferenced

<Pr o c e 9 s - o n--

"Jo-

TO C

NSNI Demand"

No0 Yes

Purchase SAMMSrequest generates apackage purchase

de eloped f3r request forprocure ent contracting

Technicalresearch

rr:vl:7:h:"dPa:Tts dat:

FROM

D

Contracting Contract NOCHICO - <establi2hed) TO E

YesTO F

Figure 12. Flowchart - Defense Logistics Agency (Cont.)

71

IRO generated StIcIage"Aitodin to center MCWASP Part picked.

s itocxage center computer and packed-Assigned BA generates C3

status FORM :348-I

DistribuLion Transportationsection ships part IAW

-Schedules OD Form 1348-1shipment and instructionsenters -DD

SAMMSAssign BB generates

C status and zero balanceIEC notification

for IM revie.

SIM or SOC

init ate Yes

Specia Order On order'?or d~rect

shipment

IM or ESOCestablishes a

spot buy, stock

replenishment

action taken

Solict/review Order part S~I.p topossible Evtablish/ Specify requesting baoe

E commercial negotiate shipping via fastestsources contract instructions traceabie means

FJFigure 12. Flowchart - Defense Logistics Agency (Cont.)

72

All 463L MICAP requisitions enter the DLA depots either

via autodin, telephone, or message. Most requisitions are

transmitted via the autodin electronic data transfer system

(24). These transmissions enter the commurications section

of the depot. Here, a computer receives the autodin

requisitions and records them on a magnetic tape for batch

entry into the Standard Automated Materials Management

System (SAMMS). SAMMS is the central requisition processing

computer which initially screens and processes the vast

majority of the requisitions processed through the depot.

(24)

DLA depots also receive telephone and message MICAP

requisitions. When depots receive call-in requisitions, a

Custome- Service representative records the requests on a

DLA Form 934, Exception Requisition Document/Data Input.

The representative sends the completed requisitions to

Source Data Automation for keypunching into SAMMS. Message

requests enter the depots in a similar fashion except it is

the Requisition Processing Center that receives the

requisition message and manually transcribes the order

information on to a DLA Form 934 before Source Data

Automation for inputs the request into SAMMS. (24)

Once in SAMMS, the computer separates and routes

requisitions according to the type and priority of the

requisition. NSN requisitions account for the vast majority

of parts requests and follow one path, while part numbe

requisitions follow another (24).

73

NSN Requisitions. When DLA depots receive and

input NSN requisitions into SAMMS, the central processing

computer interrogates the retail inventory :omputer systems

to determine the availabiiity of the part from depot

stockage. If the NSN part is in-stock, SAMMS assigns a BA

status to the requisition to indicate the item is being

processed for release and shipment, and automatically

transmits the status to the requestor (24). At this time,

SAMMS also generates and transmits a Material Release Order

(MRO), via autodin, to the stockage center responsible for

the part. The MRO enters the stockage center computer which

then generates a DD Form 1348-1 directing the stockage

center to pick and pack the required part(s) (24).

The distribution section of the stockage center also

receives the MRO information. This function schedules the

part for shipment and generates a shipping label for the

package. The transportation section attaches shippirg label

and instructions to the package and ships it to the

requesting base (24).

If the NSN is not in-stock, SAMMS checks the NSN for a

procure-on-demand coding. This coding usually applies to

high cost/low demand items and indicates any demands for

these parts wiil be filled through procurement at the time

the order passes through SAMMS (24). Through this type of

procurement arrangement, depotT tradeoff inventory carrying

costs associated with stocking these parts for increased

response or fill times for requisitions of these parts.

74

SAMMS automatically generates a purchase request for

procure-on-demand items. Contracting receives these

purchase requests and procures the item, usually through a

pre-ebtablished source or contract. These contracts also

specify the shipping response times and shipping

instructions for various order priorities. The contractor

ships the item in accordance with the contract, usually

shipping directly to the requesting base (24).

If the NSN is neither in-stock nor a procure-on-demand

item, SAMMS assigns the requisition a BB, backorder, status

along with an estimated shipping date (ESD). The ESD

provides an estimate of when the part will be released to

the customer, and is based on a contract delivery date, if

one exists, or on a standard delivery date, if no contract

is yet established for the part (30). SAMMS generates a

zero balance notification for Item Manager (IM) and

Emergency Supply Operations Center (ESOC) review (24).

When the IM and ESOC receive the zero balance

notification on a MICAP 01-03 priority requisition, they

check the order status of the part. If the item is on

order, the IM or ESOC has the option to expedite the

manufacture or delivery of the part. To expedite, the IN or

ESOC either requests the contractor to expedite the

manufacture and shipment of the part, or initiates a special

order directing the expedited manufacture and delivery of

the part to the depot or requesting base (24).

75

The chosen expediting procedure depends on the IM or

ESOC evaluation of the type of contract in existence and the

estimated contractor response time. If the part is not on

order, the IM or ESOC initiates a spot buy to satisfy the

MICAP requisition, and the IM takes further action to

replenish the stock. In either a special order or spot buy

situation, the IM or ESOC contacts the contracting office to

initiate a contract that most expeditiously delivers the

item to the requesting base (24).

Part Number Requisitions. When part number

requestz are received, SAMMS electronically transmits the

part number requisitions to the Defense Logistics Supply

Center (DLSC) to be cross-referenced against a computerized

listing of all items stock listed within any of the

Department of Defense supply systems. DLSC normally

receives, processes, and returns the results from the cross-

check to the depots within a matter of hours. The results

provide either an NSN equivalent to the part number or

statement indicating no equivalent NSN was found. If the

DLSC check returns an NSN, SAMMS updates the requisition

with the USN and processes the order as an NSN request (24).

If no NSN is found, SANNS gep- .s a Purchase Request

(PR) package containing all the part information reported in

the requisitioner's request and recorded on the DLA Form

934. Technical Research reviews this form to ensure as much

part information as possible is included in the package

76

before submitting the Purchase Request to the contracting

office for procurement (24).

Contracting solicits and reviews commercial parts

contractors and manufacturers to locate a source for

procuring the required part. If a contract already exists

with a contractor able to provide tha part, the contracting

office directs the source to ship the part directly to the

requesting base via the fasi-est traceable means (24).

If a contract does not exist with a contractor able to

provide the part, the contracting office solicits bids from

contractors who can provide the requisitioned part. If a

contractor is found, the contract office establishes a

contract for the manufacture and/or purchase of the part.

The contract also provides the directions for shipping the

part, usually instructing the contractor to ship directly to

the requesting base by the fastest, traceable means

available. If a contractor is not found or if a reasonable

or economical price is not available, DLA sends MICAP

Control a message stating the reason for not filling the

requisition, and authorization to procure locally, if

possible (24).

Air Logistics Center Processing

MICAP requisitions also provide the inputs to the ALC

depot system. The ALC depots process MCAP requisitions in

much the same way as the DLA depots. The folloing process

descriptions reference the DLA processes to avoid

repetitious descriptions of identical functio.is. The major

77

difference between the DLA and ALC systems results from the

different FSCs managed by the two systems. ALC depots

primarily process requisitions for major assemblies and sub-

assemblies of the 463L equipment rather than the smaller

components and parts managed by the DLA system. The result

of this division of responsibility is that the ALC processes

manage approximately fifteen percent of the MICAP

requisitious entered into the depot system. This section

presents the ALC depot procedures for processing MICAP

requisitions and describes the process flow diagrammed in

Figure 13.

MICAP requisitions enter the ALC by either autodin,

telephone, or message. Autodin requisitions enter the ALC

requisition processing system through the M024 computer in

the Communications Center of the depot. The M024 computer

receives the incoming autodin transmissions on a magnetic

tape for batch input into the D035, Stock Control and

Distribution System, six times daily or every four hours.

The Customer Service section of the depot receives all

telephone requisitions and inputs the request directly into

the D035 system, eliminating the inherent processing delays

of the autodin batch processing system. Data automation

receives message requisitions and keypunches these

requisitions into the D035 system again avoiding the batch

processing delays incurred in transferring autodin requests

between the M024 and D035 systems (18).

78

MrCAP ecControl 0

Logitic MAuodetion uoi ytm-eod a ie

Cente t~reanismision poceossingTO

MCqust gentert? Xhi2n

Air 024 comute Dint o Cs

Figuric 13.e Floharyte -ReAird Logitic Center

Cenec ran is~on n t 00SA79

A

Control and Par.Nm ~4~hr No <As:7:>1. Yes

Distrbution Req' s'L~or ava ~ble' 70 1

deliver, 00 Parts locaed.c ppr

Cproprse C.0l3d Ret ic kedntaouSe7Rfrne u o!

Fi <r 13 Flo car t e- rlL g st c C n er ( on .

No0

D033 Retai D009.Redistributon Stock Control Shipment

Oraer (RD0O and Control andsent to D033 Distribution Reiease

System System

-Adusts Establishesinventory and prepares 24 hour celay-Provides DO Form Batch processstorage 1348-IA

location

-Receives pact Prints shipping to up and delivers

I & DO Form 1348 labels. ATCMD transportation item to-Packs IAW Air Manifest area LOCEXPRESS.regulations IDC, as req Post 0ffice.etc

Depot processingtime ends whenmaterial passes

through SPALS

Figure 13. Flowchart - Air Logistics Center (Cont.)

81

NSN Requisitions. Once in the D035 system, the

computer separates part number requests and NSN requisitions

for further processing. NSN requisitions undergo the

following processes. The D035 begins by interrogating its

database to determine whether or not the NSN is available

from depot stocks. If the part is not in-stock, the

computer generates a report for Item Manager review. The IM

takes the computer report and checks on the status of the

part. If the part is on-order, the IM expedites the

delivery of the part, if possible. If the part is not on-

order the IM uses the MICAP requisition to develop a

purchase request for the contracting office to use in

procuring the part. Both the expedited delivery and

purchase request processes follow the same guidelines

outlined in the DLA process description above (18).

If the NSN part is in-stock, the D035 generates and

transmits a Redistribution Order (RDO) to the D033, Retail

Control and Distribution System. 1'he D033 adjusts the

inventory information to reflect the reduction of on-hand

stockage because of the order fill action. The D033 system

provides storage location data for the parts required. The

D033 then transmits the RDO and storage location data to the

D009, Shipment Control and Release System (18).

The D009 gathers packing and shipping instructions from

the 0013 Packaging/Transportation Data Maintenance System

and specific warehouse storage location data from the D103

Central Material Locator System. "The [D009] system then

82

performs its own logic and edit checks to verify that the

requisitions are in compliance with the Military Standard

Requisitioning and Issue Procedures (MILSTRIP)" (18). Once

this check is completed the D009 passes the issue release

and location data to the MCS, Mode and Carrier Selection

System. The transfer of information from the D009 system to

the MCS system only occurs once a day between 0001 and 0300

hours in the morning. This once a day batch processing

creates an inherent delay in the processing of MICAP

requisitions of up to 24 hours, depending on when the

requisition is received by the M024 system (18).

The MCS uses the shipment Driority together with the

shipping instructions from the D009 system to select the

appropriate mode and carrier for moving the MICAP part to

the requisitioning location. The MCS prints out a DD Form

1348-1A, Issue Release/Receipt Document, containing all the

shipping data unless specitic shipping exception data

accompanies the MICAP rcquisition (18).

In cases where requests for special, non-routii.

expedited shipping acticn accompany MICAP requisitions, the

MCS generates exception worksheets for manual shipment

planning. The Shipment Planning department manually plans

the shipment and enters the shipping instructions into the

MCS computer which prints the shipping instructions on to a

DD Form 1348-1A. An expeditor picks-up and delivers the DD

Forms 1348-IA to the warehouse in which the requisitioned

part is stored (18).

83

Once DD Forms 1348-IA arrive at the storage warehouse

for the part, a warehouseman takes the forms, and, using the

warehouse location printed on the forms, locates the part.

He/she ensures the stock number of the part matches the

number listed on the DD Form 1348-1A and pulls the part for

routing to the packaging section. An expeditor picks up the

part and DD Form 1348-1A and delivers them to Central

Packing. Central Packing prepares the part for shipment in

accordance with the 0013 packaging data listed on the form

and forwards the part tc the SPALS, Shipment Pl:.nning and

Address Labeling System (18).

The SPALS work area receives the package and DD Form

1348-1A and enters the shipment information into the

MCS/SPALS computer. The computer selects the final mode and

carrier for the shipment and prints the shipping labels

along with any required Advanced Transportation Control

Movement Documents, and Intransit Data Cards and releases

the pac~aoes for shipment. The packages move to the

transportation area for onward movement to the final

destination (18).

Part Number Requisitions. When ALC depots receive

part number requisitione, the requests enter the D035

system. The D035 identifies the equest as a part number

requisition and submits the request to a computerized ALC

part number cross-reference check. If the check crosses the

part number to an NSN, the requisition is updated to reflect

the NSN and the request re-enters the D035 for processing as

84

an NSN requisition. If the part number is not crossed to an

NSN, the requisition receives a IC exception code and is

sent to the Defense Logistics Supply Center (DLSC) for a DOD

part number/NSN cross-reference check.

The IC exception code provides a positive means for

tracking the requisition while it is outside of the depot

processing system. If DLSC crosses the requisition to a

NSN, the requisition re-enters the DO?5 system as an NSN

request. If DLSC did not cross the part number to a NSN,

the requisition enters the technical research section of the

depot fir further research. (18)

Technical research personnel along with Equipment

Specialists use T.O.s and manufacturer data to locate a

source for the part. If in their research the specialists

oross the part to a stocked item, the requisition re-enters

the D035 System for processing as an NSN request. If a

source for the part is not located, or the process results

in a decision that the part is uneconomical to procure, the

depot sends the requestor a message reflecting the results

of the research. This message may authorize the base to

locally procure or fabricate the part if possible. If the

research identifies a source of supply or is able to find

the part specifications, the requisition receives a BZ

status indicating that contracting actions are being

conducted to procure the part. The depot sends this status

to the requestor who may wait for the part to be procured or

look elsewhere for a source of supply.

85

Summary

The flow charts and process descriptions presented in

this chapter described the processes and procedures followed

by each of the major functions operating within the pipeline

for 463L MICAP spare parts. In so doing, the chapter

described each of the different pathways a parts requisition

may follow as it flows from vehicle maintenance through base

supply and on to the Air Force and DoD depot systems. The

flowcharts also provided a visual reference of the

requisitioning process illustrating the complexity of the

process as well as, the interrelationships of the different

sections of the pipeline.

The interrelationships of the functional areas within

the pipeline are integral to this process description. This

description brings together in one document, one inter-

connected flow, process and set of procedures which are

normally developed and evaluated separately and in

isolation. By drawing together the processes of the entire

pipeline, this flow enables pipeline managers to evaluate

their individual functions in relationship to the pipeline

as a whole. In essence, this chapter provides the tool for

conducting a macro-system type analysis, as described in

Chapter I, on the 463L spare parts pipeline.

The 463L supply pipeline described in this chapter also

provides the basis for the analysis in the following

chapters. Chapter V looks at the 'ownership" and management

of the pipeline and analyzes the measurements and reports

86

used in evaluating pipeline, while Chapter VI analyzes the

pipeline against the "ideal" order process described in

Chapter II.

87

" L u_ mmm mlii i mmm IIMIN

V. Analysis

Introduction

This chapter addresses the last three investigative

questions posed in Chapter I. The answers to these

questions, along with the process decriptions and flow

diagrams of Chapter IV, combine to provide an answer to the

specific issue for which this research was conducted, "What

organizations and processes make up the current spare parts

pipeline for 463L equipment, and how do these organizations

and processes affect the availability of 463L equipment?"

Overview

The analysis presented in this chapter focuses on

answering the following investigative questions:

-- Who is responsible for monitoring the data

collected for the unit and for the system as a whole?

-- How are processing times recorded and what reports

reflect and summarize these times?

-- What are the average processing times and time

distributions for each section of the pipeline? How do

changes in the times and distributions impact the

pipeline time as a whole?

To ensure these answers logically document the pipeline

process, the analysis also addresses the last of Gitlow's

process documentation questions posed in Chapter III as key

to understanding processes. These questions are:

--Who owns the process?--What are the objectives of the process?

53

-- How is the success of the process in meeting

the objectives being measured?--Are the measurements being taken on the

process valid? (11:42)

The answers to these questions, along with the flowcharts

and process descriptions from Chapter IV, provide the basic

information required to initially document the 463L pipeline

process. This information provides managers with a logical

and complete understanding of the process they manage, and,

with this -inderstanding, managers should be able to improve

the system they control and operate (11:42). Thus,

answering the investigative qu.-stions and Gitlow's questions

together establishes the initial step to improving pipeline

performance.

This chaa.ei is divided into three major sections. The

first section responds to the questions regarding ownership

and responsibility of the pipeline process. The second

addresses the issue of pipeline management measurements and

reports. This section presents the measures used in

evaluating the performance of the 463L pipeline and

discusses the validity of these measurements. The third

section presents 463L pipeline time distributions developed

from data collected throughout this research.

Ownership of the 463L spare parts pipeline

This section addresses the investigative question, "Who

is responsible for monitoring the [pipeline] data collected

for the unit and for the system as a whole?" as well as

Gitlow s question, "Who owns the process?"

89

Monitoring and managing the 463L spare parts pipeline

was found to be split between each one of the sections and

units involved in the processing of MICAP requisitions.

Each section evaluates reports reflecting its own

performance measurements relating to either pipeline

processing times or functional objectives. The difference

between processing time and functional ubjectives centered

on the time factor.

Functional measurements and reports reflecting supply

status and Estimated Delivery Dates (EDD) act to maintain

the integrity of the pipelinL- process by monitoring the

status of requisitions as they progress through the

pipeline. Functional measurements, like fill rates and

backorder notifications, ensure requisitions are not lost or

ignored within the pipeline and, in so doing, help maintain

the pipeline flow. In essence, functional measurements

effect pipeline processing times, but do not monitor the

overall processing times of the pipeline as do pipeline time

measurements and reports. Table I, Functional Objective

Measurements i Table II, Pipeline Time Measurements,

include the performance measures and reports found to be the

key management tools for each section of the pipeline.

These measures and reports are discussed in detail in the

next section of this chapter.

Only the vehicle maintenance and depot organizations

within the pipeline monitor reports which reflect summary

90

Table I. Functional Operations Measurements

Section/Report Functional Concern Factors Considered Factors Not Considered

Material Control -Supply Status and -Each individual -Consolidated information-DI , Daily Priority EDD of each requisition recording total requisitionMonitor Report vehicle part -MICAPs processing times for

requisition -?ad status vehicle parts

-Slipping/Overdue! EDDs

Demand Processing N/A N/A,-No Pipeline Reput N/

MICAP Control -Supply Status and -Each .....siton -Consolidated information-D49, MICAP Status EDD for all oase managed indi-'dually recording total requisition-MAC Forms 12 MICAPS -Bad status processing times for base

-Slipping/Overdue or vehicle parts

EDDs

DepotsALC -Fill Rates

--By Depot & IMReport names and -Backorder

numbers unknown Notifications

--Daily & Weekly

DLA -Fill Rates -Percent of total -Carry over unfilled-Report Unknown --Depot requisitions filled requisitions-Report Unknown --IM from on-hand stock $DF 112, Weapon System-Report (See V --Weapon System Summary Status Report

-BackorderNotifications

Reports (See I) --Daily -Backorders estab. tIFOl9, Daily Backorderprevious day Notification

--Weekly -Unfilled Backorders F269, Weekly Backorder(Total) Notification

--Weapon System -Unfilled Backorders DF137A, Weapon Systemby weapon system Backorder Listing (Monthly)

91

dit 11. Pipeline Time Measurements

Section/ Portion of Pipeline Factors Factors Not

Measurement/Report Measured . Measured Measured

Vehicle Maintenance From VM approval [Total hours 463L -Multiple parts per vehicle

for VDP to receipt vehicles are down -Vehicle mechanic and

-VDP Rates of part in vehicle for parts Material Control Darts--PCNO032 maintenance research and documentation

time

Depots

ALC-From MICAP Control -MICAPs -Delayed Action Shipments

Pi'eline processLng requisition to part -Off-the-Shelf --Shipments delayed due toTimes receipt by base shipments lack of depot stock, IM-LOG-LD(M) 7922, supply review, incomplete orders

Part I-3 measures -MICAPs -Delayed Action Shipments

Depot Processing --ICP Time -Off-the-ShelfTimes --DS Time shipments-LOS-LO(M) 7922, --Total Depot Time

Part 1DLAPipeline processing -From MICAP Control -01-03 Priority -MICAP/999 requisitionsTimes requisition to part requisitions specifically-MILSTEP Highlight receipt by base -Off-the-Shelf -Delayed Action ShipmentsTable supply shipments

Depot processing -Believed to be -MICAP/999 requisitionsTimes similar to ALC -Delayed Action Shtipments-Reports unknown measures

92

statistics for pipeline processing times. Although the

reports include pipeline processing times, none of the

reports provides a complete representation uf the pipeline.

Tables I and II also list the factors included and excluded

from the reports to illustrate the capabilities and

limitations of these reports. The next section of this

chapter more fully explains thpse limitations.

During the course of this pipeline research, no single

organization or office was found to either manage or monitor

the entire 463L spare parts pipeline. The lack of single

manager responsibility made it difficult to locate the

pipeline management reports reflected in Tables I and II.

Although some of the specific reports were not found, the

information listed in the tables still provided a sufficient

data base from which to discuss the pipeline as a whole.

The next section presents some of the measures and

reports used by the different portions of the pipeline to

measure the performance of different aspects of the

pipeline.

Pipeline Performance Measurements and Reports

The investigative question addressed in this section

is, "How are processing times recorded and what reports

reflect and summarize these times?" In addressing this

question, the remainder of Gitlow's essential questions for

process documentation provided a means to evaluate the

measurements and reports presented, particularly those

93

dealing with pipeline times and fill rates. Thus, the three

questions guiding the discussion of the pipeline management

tools are:

--What are the objectives of the process?--How is the success of the process in meeting theobjectives being measured? and--Are the measurements being taken on the processvalid? (11:42)

Gitlow's questions delve into the make up of performance

measurements and management tools. Evaluating pipeline

measurements and reports with these questions ensures that

the capabilities and limitations of these management tools

are fully understood and are not blindly accepted at face

value.

This section presents the pipeline measurements and

reports most frequently cited as key management tools used

in monitoring and evaluating pipeline performance. Although

this section focuses on pipeline processing time

measurements and reports, it presents the key reports used

to ensure the pipeline functions properly. The functional

reports are used to monitor individual requisitions and fiil

rates, and provide pipeline organizations with information

supporting the pipeline process. These reports are not

directly related to pipeline processing times, but they do

contribute to the timely processing of requisitions within

the pipeline and thus effected pipeline performance.

The measurements and reports of each of the major

sections of the pipeline are presented separately to

parallel the process description presented in Chapter IV.

94

Each measurement and its associated report are presented

with an explanation of what they represent and what they do

not represent, as presented in Tables I and II. This

comparative explanation is used to illustrate the

limitations of the measurements and reports used to manage

the 463L spare parts pipeline.

Vehicle Maintenance. The pipeline performance

measurement monitored and evaluated by vehicle maintenance

is the Vehicle-Down-For-Parts (VDP) rate. Although the

primary purpose of this rate is to help gauge vehicle

availability, it also provides a limited measure of pipeline

performance as it indirectly measures parts availability.

This rate represents that portion of time vehicles are out-

of-service because of a lack of parts or material required

to repair the vehicles (7:86). In other words, the VDP rate

is a reflection of the non-availabili-y nf vehicles because

of a shortage of parts from base resources.

VDP rates for 463L vehicles are computed an reported

L:,iu%.,;" ' Vehicle Tntnar~-d Management System (VIMS),

which provides VDP information on the PCNO032, Vehicle

Management Report. The source data for computing the VDP

rates come from the VDP ctare- and stop times recorded on the

AF Forms 1823, Vehicle and Equipment Work Orders. As

explained in Chapter IV, the VDP times start when the

Vehicle Maintenance Officer (VMO) approves the VDP condition

and stops when the part is received by vehicle maintenance.

The VDP times recorded on the work orders incorporate the

95

broadest pipeline measure of the 463L spare parts pipeline

of any of the pipeline reports, but the measure still omits

the time required to research the part, conduct the

preliminary stockage availability checks, receive the VMO's

approval, and prepare and transmit the order to base supply.

As indicated in Chapter 11, this initial part of an order

process often is overlooked in the calculation of the order

processing time even though it cnstit',tes . major portion

of the total order processing system.

Although the VDP rate reflects the total amount of time

vehicles are down for parts, it does not reflect the total

amount of time the pipeline is actually in motion. The

reason for this disparity is that the VDP time only accounts

for the time a vehicle is down for parts, regardless of the

number of parts the vehicle requires.

There is also a difference between the VDP time as a

percentage of vehicle availability and the number of MICAP

requisitions as a percentage of total requisitions. The

following analysis illustrates this difference. During the

course of this research, the 463L vehicle AF Forms 1823 from

Charleston AFB, SC were reviewed providing the information

in Table ITI. As illustrated, over a period of 132 days the

VDP rate for 463L vehicles was only i.6 icrzent com p-Aed to

the 5.7 percent figure for the rate of MICAP requisitions to

total parts requisitions. The study also showed that 14

96

Table III.Vehicle-Deadlined-for-Parts Data

VDP rate ':Aculated from source data (percent): 1.8Tot- * vehicles assigned: 58

j! # available hours for period studied: 183744,otal # of vehicles VDP during period 14Total # hours VDP: 3397

Number PercentTotal non-deferred requisitions processed: 422 100Total MICAP requisitions 24 5.7

Source: AF Forms 1823 from March - June 1989Charleston AFB, SC

vehicles were diwn for a total of 24 MICAP parts

illustrating that VDP rates and figures can hide or diminish

problems in the pipeline.

The difference between the number of vehicles VDP and

the number of MICAP requisitions becomes even more

significant when cannibalization is used to secure needed

vehicle parts. When cannibalization is used, one vehicle

down for parts actually represents two or more vehicles and

many more parts. In this case, the VDP rate significantly

diminishes the problem of parts non-availability.

Considering this type of situation, the 30 to 60 percent VDP

rates experienced in Vietnam (25:70), as indicated in

Chapter I, may have represented an even greater problem with

the pipeline. The difference between VDP and parts

availability also may hide parts availability problems

accompanying military spending cutbacks. The VDP rates in

this situation would provide a false indication of unit

readiness.

97

Material Control. Performance measurements

monitored by the Material Corntrol section of vehicle

maintenance are functional rather than pipeline time

measurements. Material Control monitors the activity of the

pipeline to ensure that all active MICAP requisitions for

vehicle maintenance are processed properly through the

supply pipeline. One of the key areas of concern for :he

material controller is the status of MICAP requisiticns.

After material control submits a M:CAP request to Demand

Processing and MICAP Control, the controllers monitor the

)16. Priority Monitor Report, to ensure the request is

processed correctly and in a timely manner (33).

The DIS is a dailv report, generated by the Standard

Base Supply System (SBSS), which lists the status and EDDs

for all MICAP requisitions submitted by vehicle maintenance.

The material controller checks the status of MICAPs daily to

ensure the supply status and EDDs of the requisitions remain

p-sted and good. If the status of a MICAP changes or an EDD

slips or is overdue, the material controller contacts MICAP

Control to find out why the status changed or why the part

has not arrived (33). If the controller discovers a problem

with receiving the part in a timely manner, he takes action

to increase the visibility and urgency of the requisition by

requesting supply follow-up and supply assistance actions be

taken (33). Through his constant monitoring and

coordination with MICAP Control, the material controller

works with the MICAP system to ensure the system functions

98

properly, and it effectively processes each MICAP

requisition submitted for vehicle maintenance.

Demand Processing and MICA? Control. As indicated

in Table I, Demand Processing does not generate or monitor

measurements or reports, but the MiCAP Control section of

base supply monitors functional measures and reports similar

to Material Control.

Once MICAP Con rol generates and transmits MICAP

requisitions to ALC .r DLA depots, they monitor the daily

D49, MIC.'P Status Report, generated through the SBSS. This

D49 report provides MICAP Control with the current status of

all the active MICAP requisitions generated from the base

(8:6-491). 463L MICAPs make up only P small portion of the

MICAPs listed on the D49 but MICAP Control intensely

monitors and manages these requisitions (40). MICAP 7ontrol

compares the information from the D49 report with the

information recorded cn the MAC Form 129 (40). If any

discrepancies, problems, or unexpected delays of MICAP

requisitions are found, MICAP Control initiates follow-up

actions and/or r;ubmits supply assistance requests (40).

These actions increase the visibility of the requisition at

the depot level and emphasize the need to expedite the

processing and shipment of the required part. So, although

the performance of MICAP Control is not reflected directly

in any pipeline performance reports, the effective and

99

timely processing of follow-up and supply assistance actions

by MICAP Control do affect the overall performance of the

pipeline.

Depot Performance Measures and Reports. Before

discussing performance measures and reports used in managing

the pipeline depot systems, it is important to highlight two

major difficulties experienced in attempting to identify and

analyze depot management tools. First, there are two

totally separate depot systems responsible for providing

parts support for 463L vehicles, the Air Logistics Center

(ALC) and Defense Logistics Agency (DLA) depot systems.

Each one cf these systems has its own pipeline management

system. Second, no one office or department acts as the

single manager or focal point for all pipeline measurements

and reports within either depot system.

The responsibility for monitoring and managing most

depot pipeline operations falls into two major divisions,

the materials management division and the distribution

division. Within these divisions, pipeline responsibilities

are subdivided further into different operational branches

and sections. The division of responsibilities between and

within the divisions and branches of the two depots systems

made it very difficult to find the measurements and reports

used to evaluate, monitor, and manage the depot functions of

the spare parts pipeline. As a result, the measures and

reports described below and listed in Tables I and II do not

represent all of the tools used to manage the pipeline, but

100

do represent the most frequently mentioned measurements and

reports cited by the pipeline technicians and managers

interviewed.

Both ALC and DLA depots monitor similar aspects of the

supply pipeline, those being stockage fill rates and

pipeline/depot processing times. Fill rates are functional

measurements used to evaluate depot capabilities for filling

requisitions from on-hand inventory. These measures apply

mainly to the performance of the Item Managers (IM)

responsible for managing parts and materials. Pipeline and

depot processing times measure the time it takes

requisitions to be processed from order initiation to part

reception by the requesting base. Both fill rate and

processing time measurements provide management with very

specific pipeline information with underlying caveats which

must be known before one can evaluate the usefulness of the

reports.

Stockage Fill Rates. Depot stockage

performance is monitored in two ways, through fill rate

reports and backorder notifications. Fill rates are used to

evaluate the effectiveness of depot stocks. These rates

represent the percentage of requisitions received by a depot

and filled from depot stocks the first time the requisitions

are processed through the system. In essence, fill rates

measure the capability of depots to fill requisitions

without having to backorder the items required.

101

Fill rates are measured routinely for depots and Item

Managers (IM), but they are also measured for specific

weapons systems, like 463L equipment. The DLA depots

capture and monitor fill rates for 463L equipment through

the Weapons System Support Program (WSSP). The DF1l2,

Weapon System Summary Status Report, reflects the fill rates

for 463L requisitions, but the fill rates reported in the

DF112 report do not consider all backordered requisitions.

While analyzing the DFl12 report, it was found the fill

rates reported reflect only the number of backorder

requisitions established during the current reporting

period, but do not include backorders carried over from

previous reporting periods. The report does list the total

number of current and combined backorders, but the combined

backorder total is not used in the calculation of the supply

effectiveness percentage. By not including the total number

of backorders in the system, the fill rates do not reflect

the supply effectiveness experienced by field organizations,

like vehicle maintenance, which equals the total number of

parts backordered, not just the newly established

backorders. Because of this limitation, the fill rates

reported in the D112 provide only a partial picture of depot

performance in providing weapons system support.

DLA and ALC depots use backorder notifications to help

ensure backorders are identified and stockouts alleviated.

As listed in Table I and II, DLA depots use three reports to

monitor backorders, the F019, Daily Backorder Notification,

102

F269, Weekly Backorder Notification, and DFl37A, Weapon

System Backorder Listing. The F019 report lists backorders

established during the previous day's automated requisition

process. The F269 report lists all of the requisitions

still on backorder at the end of each week. Together these

two reports ensure IMs are aware of each backorder as they

occur and remain aware of backorders until they are

resolved.

The DF137A report provides the Weapons System Support

section an end of month listing of all backordered items by

weapon system by National Stock Number (NSN). This list

focuses the attention of weapons systems monitors on the

parts required to satisfy backordered parts for weapons

systems, including 463L vehicles. This breakout of 463L

specific NSNs enables weapons system monitors to intensely

monitor and follow up the status of the contracts and orders

established to procure these items. The follow up actions

by the Weapon System Support section ensures the urgency and

priority of these items.

Together the fill rates and backorder reports provide

pipeline managers with information, although somewhat

limited, required to monitor and manage depot stockage

effectiveness. The daily and weekly backorder reports

provide item managers with the tools required to monitor

daily depot operations as they serve as "flags" alerting

managers to unfilled requisitions. Fill rate reports

furnish depot managers and IMs with the performance

103

statistics to manage stockage effectiveness. Backorder

notifications and fill rate reports thus provide the day-to-

day and summary data used in managing the performance of

depot stocks.

Depot Processing Times - Standards and Reports.

Depot processing times for both the ALC and DLA depots

are based on the Uniform Material Movement and Issue

Priority System (UMMIPS). The UMMIPS establishes the

standards for requisition order tramsmission and shipment

times by requisition priority classifications. These

classifications provide depots a priority system to record

and monitor depot and total pipeline processing times for

requisitions processed through their locations. The

pipeline managers use these reports to evaluate their

pipeline performance against UMIIPS standards.

Through the course of this research, it was found ALC

depots evaluate their pipeline time performance by using

Part I of their RCS: LOG-LO (M) 7922, Material Pipeline Time

Report (By Geographical Area). This report segments

pipeline processing times by depot, priority and

geographical area for requisitions satisfied from off-the-

shelf depot stocks. The only report found to refect DLA

pipeline processing times was the MILSTEP Highlight Table -

Pipeline Performance Analysis. This table reports pipeline

performance standards for DoD service depot systems as well

as DLA depots. The DLA pipeline processing times reflected

in this report consolidate the processing times of DLA

104

depots and stockage centers into average pipeline processing

times for each UMMIPS requisition priority category and

geographical area. Both the LOG-LO (M) 7922 and the MILSTEP

Highlight Table pipeline times are used to evaluate the

performance of the ALC and DLA pipeline systems,

respectively, against UMMIPS standards. The focus of these

management reports is analyzed in this section.

Although ALC and DLA depots collect data in accordance

with UMIPS guidelines, the ALC depots also collect and

monitor data for MICAP/999 (high priority) requisitions.

The DLA depots group these MICAP type orders together with

01-03 priority requests. This difference results in an ALC 14

depot capability to specifically monitor their performance

and focus their attention on the most critical requisitions,

the MICAP/999 requisitions required to support mission

critical systems. Since DLA depots do not segment MICAPs

from other 01-03 priority requisitions, DLA managers are not

able to focus on pipeline times for MICAP/999 requests for

mission critical items.

The key pipeline processing time management reports for

DLA and ALC depots have a major management limitation, they

only measure and monitor requisitions for off-the-shelf

items. Off-the-shelf requisitions are those requests

processed through depot processing systems with no

managerial or stockout delays. This means the only

requisitions included in the management reports are for

items immediately available from on-hand stockage. This

105

ideal off-the-shelf scenario reflects only on how well depot

systems function in ideal situations; they do not represent

the actual depot processing times experienced by the

organizations submitting requisitions.

Requesting organizations experience and evaluate

pipeline performance based on all requisitions submitted to

depots, not just orders filled immediately from depot stock.

This means the pipeline processing times experienced by

field organizations differ from the times used by pipeline

managers to evaluate pipeline performance. This difference

creates a gap between the pipeline managers' perceptions of

pipeline performance and the actual pipeline performance ,-

experienced by the users.

The difference in perceptions between pipeline managers

and users focuses on the intent of the pipeline system.

Should the pipeline be measured and evaluated from the

pipeline managers' perspective or from the users

perspective? As cited frequently throughout Chapter II and

concisely stated by Gattorna, "The single output of any

organization is customer service. Customers, not managers

or products, drive the organization" (10:11). If the

purpose of the depot system, specifically, and the supply

pipeline, generally, is to support the customer or user,

then the performance of these systems must be evaluated from

the customer's perspective. From this perspective, pipeline

performanc. depends not only on those off-the-shelf items

reflected in the management reports used by depot and

106

pipeline managers, but on all items requisitioned by the

users. This means all requisitions submitted to the depots

must be included in the pipeline performance measures and

reportz to reflect a true picture of pipeline performance

from the users perspective.

Part 1 of the RCS: LOG-LO(M) 7922 and the MILSTEP

Highlight Table provide a picture of depot and pipeline

performance for requisitions meeting the ideal fill rate

criteria from on-hand depot stockage. As a result, the

reports only reflect a portion of the pipeline the user

encounters. A far bt-.ter indicator of pipeline performance

would include the processing times for parts out-of-stock or

delayed items together with off-the-shelf items.

ALC depots have consolidated off-the-shelf and delayed

action requisition pipeline time reports. These reports are

found in Part 3 of the RCS: LOG-LO(M) 7922, Material

Pipeline Time Report. The pipelines within these reports

reflect the actual average processing times experienced in

the field for all depot requisitions. These reports provide

a more accurate measurement cf the customer service provided

by the ALC pipeline. Part 2 of this same report reflects

the processing times for only the delayed items and provides

a measure of the worst case scenarios, when requisitions are

received for parts not on the shelf. Together Parts 1, 2,

and 3 provide ALC pipeline managers with tools for more

effectively measuring pipeline performance.

107

Although ALC depots and their headquarters at the Air

Force Logistics Command (AFLC) do receive and file all three

of these reports, only Part 1, reflecting the best case

scenarios, is monitored (20). This report comes the closest

to meeting UMMIPS standards, but it does not provide a true

picture of pipeline performance.

463L Pipeline Time Distributions

This section addresses the final investigative

questions of: "What are the average processing times for

each section of the pipeline?' and 'How do changes in the

times and distributions impact the pipeline time as a

whole?"

As stated in Chapter 3, the 463L pipeline processing

time data collected and recorded by pipeline organizations

failed to provide the information necessary to develop

individual processing time distributions for each pipeline

function. The difficulty encountered in trying to gather

processing time data for individual segments of the 463L

pipeline was twofold, source documents and reports either:

a) captured processing time data for the entire 463L

pipeline with no breakout of pipeline times within or

between pipeline organizations; or, b) captured and reported

segmented pipeline times for all priority requisitions with

no breakout of 463L requisitions. As a result, no

meaningful 463L pipeline time distributions could be

developed for each organization within the pipeline.

108

Although no section sources were found to provide

section specific time data, three sources were found to

provide processing time data for the whole 463L pipeline.

These sources were the D165 weapon system computer, the MAC

Forms 129, Supply MICAP Checklists, and the AF Forms 1823,

Vehicle and Equipment Work Orders. Pipeline time

distributions developed from these sources are presented and

analyzed in the following subsections. The data presented

in these examples currently is not readily available to

pipeline managers and may provide insight into the pipeline

that is not normally considered in pipeline evaluation.

Source: The D165 weapon system computer. The 463L

pipeline data collected from the D165 system reflects the

the time between when MICAP Control submits a MICAP

requisition to the depot system and when base supply

receives and in-processes the part requested. This period

equates to the order transmittal, depot processing,

transportation, and order receiving time for 463L

requisitions. Frequency distributions developed from this

data provide a graphical representation of the variation of

pipeline processing times for requisitions reported in this

system.

Figures 14 and 15 illustrate the frequency distribution

of the 463L requisition pipeline times recorded in the D165

system for both DLA and ALC depots, respectively. These

distributions include both off-the-shelf and delayed

shipment depot requisitions for MAC CONUS bases and select

109

V-7

21--

Q-j(N Ln c n o L n o L

Ln ,: Tr) C cI -l -

110.

K-r

CNU

oc

No-

0 -U--,(I1

overseas MAC units. Approximately 86 percent of both tne

DLA and ALC requisitions reflected in these distributions

are from CONUS locations.

As can be jeen in the figures, both distributions are

skewed to the right meaning most of the requisitions were

satisfied over the lesser time periods. In fact, 82 percent

of the DLA and 64 percent of the ALC requisitions were

satisfied within the seven day UMMIPS pipeline time standard

for priority 01-03 and NMCS (Not Mission Capabie - Supply

for CONUS shipments. If compared to the more restrictive

Air Force standard of 3.5 days for MICAP/999 requisitions

only 53 percent of DLA and 31 percent of ALC of the 463L

MICAP requisitions were satisfied within the standard. it

must again be stated that DLA depots do not recognize this

Air Force standard; DLA depots measure their performance

only on the seven day UMMIPS standard for NNCS and 01-3

priority requisitions.

Do these actual 463L requisition pipeline times meet

Air Force mission requirements? This question cannot be

answered through this analysis, but a closer look at an

example of how these figures relate to the pipeline times

experienced by a base provides further insight into the

question.

Source: MAC Forms 129. The following examp.e

refects the actual pipeline times recorded on the MAC Forms

129 for 463L requisitions submitted by Charleston AFB, SC.

The pipeline time distribution graphed in Figure 16

112

represents requisition data for the months of May and June

1989. The data collected was limited because MAC Forms 129

are only retained for 30-60 days after the MICAP is

satisfied (40).

12

D0

<6i

2i

©0

2 6 10 € 84 8 12 16 2

N.ffR OF DAYS WC

Figure 16. MAC Forms 12 , - Pipeline Time Distribution

As shown, this distribution is shaped differently than

the DLA and ALC pipeline time distributions. In this

distribution, 10 of the 24 463L requisitions processed over

this period were satisfied in five to seven days. Also, 16

of the 24 or 67 percent of the requisitions were satisfied

within the seven day UMMIPS standard. This is only an

isolated ard limited example of the 463L pipeline times

113

LU mm[ ] a li

experienced at a base, but it does illustrate that there can

be a difference between the overall depot pipeline times and

those experienced by a base.

The following example shows how these individual

requisition pipeline times can affect the overall VDP times

for 463L vehicles.

Source: AF Forms 1823. The 463L VDP times

illustrated in Figure 17, reflect the VDP times recorded on

AF Forms 1823 from April through June 1989 at Charleston

AFB. Again, the data was limited because AF Forms 1823 are

only retained for 90 days after the repair was completed.

U1 5zLU

(1 4

>3

w 2

0

2 6 10 14 20 304 8 12 16 25

NI'3ER OF DAYS VCP

Figure 17. VDP Time Distribution

These times do not represent the processing times for

individual parts requisitions, but they do reflect the total

114

time vehicles are down for parts. This VDP time

distribution, then, does not directly reflect the spare

parts pipeline, but does allow for a comparison between

pipeline times and VDP times, Although this distribution

was limited, it did provide an idea of how different a

user's perspective of pipeline performance can differ from

that of MICAP Control and especiaily of the depot systems.

As Figure 17 illustrates, the VDP distribution for 463L

vehicles has a wider distribution than does the distribution

for the MICAP requisitions at either the base or depot

level. There are a number of possible reasons for this,

including the limited data base, but one key reason for this

difference is that vehicles are not taken off VDP status

until all of the required MICAP parts are received by

vehicle maintenance.

Summary

This chapter has addressed the last of the

investigative questions. As stated, the ownership of the

pipeline was found to be divided among all the organizations

within the pipeline. Each section of the pipeline monitored

its own measurements which were either functionally

oriented, supporting pipeline operations, or pipeline time

oriented, evaluating requisition processing times. This

chapter also explained the capabilities and limitations of

the performance measures and reports. It was found that

many of the measurements used to manage the pipeline only

evaluated specific portions of the total pipeline system,

115

and therefore, presented a biased representation of pipeline

performance.

Finally, this chapter explained that the difficulties

encountered in trying to gather processing time data for

individual segments of the 463L pipeline. Although these

difficulties prohibited the development of individual

pipeline time distributions, three different sources were

found to reflect total pipeline times. Four 463L pipeline

time distributions were presented to provide examples of the

total pipeline time distributions represented in the

different sources.

Chapter VI follows with the overall conclusions of this

research and recommendations for further areas of study.

116

VI. Conclusions

This thesis examined the spare parts pipeline for 463L

equipment in order to develop the flow pattern of spare

parts requirements from the identification of need to

receipt of the part. In so doing, five major investigative

questions were examined.

1. What offices, sections, and organizations are

involved in the spare parts pipeline for 463L

equipment?

2. What are the procedures followed by each

section or unit of the pipeline in the processing

of spare parts requisitions?

3. Who is responsible for monitoring the data

collected for the unit and for the system as a

whole?

4. How are processing times recorded and what

reports reflect and summarize these times?

5. What are the average processing times and time

distributions for each section of the pipeline?

How do changes in the times and distributions

impact the pipeline time as a whole?

To ensure these questions were thoroughly addressed and the

requisition process properly documented, this research also

117

addressed several questions posed by Gitlow as being

necessary to the initial documentation of any process.

These questions were:

1) What is the flow of the process?2) What are the boundaries of the process?3) Who owns the process?...4) What are the objectives of the process? How

is the success of the process in meetingobjectives being measured?

5) Are the measurements being taken on theprocess valid? (11:42)

Together, the investigative questions and Gitlow's questions

guided the research for documenting the 463L pipeline.

Research Conclusions

This section provides a summary of the conclusions

reached for each of the investigative questions.

Investigative Question One. What offices, sections and

organizations are involved in the spare parts pipeline for

463L equipment? Four major divisions of the spare parts

pipeline were found, vehicle maintenance, base supply, Air

Logistics Center (ALC) depots, and Defense Logistics Agency

(DLA) depots. Each of these divisions also had different

subsections or branches responsible for the specific tasks

within the divisions.

The following presents the major subsections found in

the pipeline. The Material Control section performed the

supply requisition and supply management functions for

vehicle maintenance. The Base Supply Demand Processing

section received and screened parts requisitions. Demand

Processing passed all 463L MICAP (Mission Capability)

requisitions to MICAP Control. MICAP Control, also a

118

subsection of base supply, acted as the intermediary between

base supply and the depot systems. MICAP Control processed,

submitted, and monitored all MICAP requisitions originating

from their base, including 463L MICAPs. Depots provided

wholesale storage and procurement functions for the

pipeline. The Materials Management sections of the depots

monitored and managed the stockage levels for Air Force and

Department of Defense items. The depot distribution

management sections monitored and managed the transportation

functions required to ship parts to the requesting

organizations. Together, all of the subsections combined to

form the pipeline for 463L spare parts.

Each one of the subsections accepted inputs from and

provided outputs to other subsections of the pipeline. This

interaction between subsections was described in Chapter I

as integral to the success of any system and the reason for

conducting macro-analytical process analyses (31:7,25). The

flowcharts developed to address the next investigative

question focused on these macro-analytical process

interactions.

Investigative Question Two. What are the procedures

followed by each section or unit of the pipeline in the

processing of spare parts requisitions? Chapter IV

presented detailed process descriptions and flowcharts for

the entire 463L spare parts pipeline, from vehicle

maintenance through the depot systems. The process flow

covered the full spectrum of the order processing system

119

described in Chapter II. In so doing, the flowcharts and

process descriptions began with the vehicle mechanic

identifying the requirement for a part and followed the

process through the five components of the order process

described by Stock: (1) order preparation and communication,

(2) order entry and order processing, (3) order picking and

packing, (4) order transportation, and (5) customer

receiving (34:499,502). This process description provided

an opportunity to evaluate the pipeline interactions from

the macro-analytical perspective.

In analyzing the requisition process for 463L spare

parts, two aspects concerning the information flow of the

463L pipeline contradicted that of the ideal order

processing information flow described in Chapter II. These

two major discrepancies involved information availability

and information quality.

Information availability problems centered around the

accessibility and timeliness of requisition transmission and

feedback. Information accessibility was a twofold problem

centering on the indirect and inefficient user-supplier

computer system. First, Material Control, at most bases,

was unable to make direct paiC availability inquiries into

the main base supply computer nor directly input their

requisitions into the supply computer. Second, Material

Control had absolutely no direct access to the depot

stockage and requisitioning computer.

120

As mentioned by Stock in Chapter II, order transmittal

should be as direct as possible using the most accurate and

rapid method, electronic transmission (34:503,505). Direct

access to both the base and depot supply computers would

enable the customer [Material Control] immediate feedback on

parts availability, which would provide greater customer

service (34: 500,505). This immediate transmission and

inquiry capability would reduce both pipeline time and

variability as the information and ordering delays created

by the multi-level supply hierarchy would be Pliminated.

Compounding the information accessibility problem was

the batch processing computer system used in transmitting

requisitions from base to depot and from depot computer to

depot computer. It was found that delays of hours or even

days were inherent in the requisition transmission and depot

processing systems.

The first delay was found to be in the autodin

transmission system between base supply and depots. Autodin

transmission from base supply were found to delay MICAP

requisitions for up to eight hours or more depending on the

batch release cycles from the base to the depot. Once at

the depot, the requisitions were further delayed from four

to twelve hours as the requisitions awaited batch release

from the communications centers to the central depot

processing computers (18; 30).

Once in the depot processing systems, requisitions

could be further delayed for up to 24 hours as the

121

requisitions were batch filed between depot computers. For

example, there was up to a 24 hour delay between the ALC

D009, Shipment Control and Release System, and the MCS, Mode

and Carrier Selection System, solely due to the once a day

batch release cycle of the D009 (18). Similar computer-to-

computer delays are experienced within DLA depots (24: 30).

As stated in Chapter II, fully on-line order processing

systems eliminate batch file delays and also increase

customer service (21:30,33). By incorporating on-line

systems and providing Material Control with computer

terminals and interactive access to both supply and depot

computers, the supply pipeline can achieve greater customer

service levels and pipeline efficiencies. These gains can

be made as computer-to-computer systems increase customer

service levels and lower total system costs by increasing

customer-supplier interaction and eliminating order entry

and processing redundancies (34: 510-511).

The second inadequacy found in the information flow

between depots and bases involved the quality of information

transmitted. Frequent errors in Estimated Delivery Dates

(EDD) for items on BB backorder status were found. The

reason this EDD information was erroneous was because it was

based on a Standard Delivery Date (SDD) established by

regulation. This SDD was often assigned to BB status

requisitions even though no firm contract or delivery date

was negotiated with a commercial supplier for the part in

question (30). The erroneous information led the requesting

122

organization to understand the part would be received no

later than the EDD. The customer had no way of knowing

whether or not the EDD was valid, and waited until the EDD

had passed before submitting a supply assistance request

(30).

The erroneous EDD information, as described above,

reduces customer service and incorporates unnecessary delays

in the pipeline as the users refrain from submitting supply

assistance requests until after the EDD is exceeded. As

stated in Chapter II, this type of system variation and

unreliability greatly reduces customer service and detracts

from a pipeline's value (10:17; 2:27,46).

Resolving the information availability and quality

concerns discovered during this thesis research can decrease

pipeline time and increase pipeline effectiveness. The more

direct interactions between Material Control and base and

depot supply systems can also increase the operational

commander's readiness. Readiness is increased since

enhanced accuracy of supply status enables operational

commanders to more effectively plaL, support, and control

operations (4:3-5).

Investigative Question Three. Who is responsible for

monitoring the (pipeline] data collected for the unit and

for the system as a whole? As illustrated in Tables I and

II, each section of the pipeline was found to collect and

monitor its own specific data. This data reflected either

functional objectives or pipeline processing times. The key

123

difference between the two areas of concern was the time

factor. Also, addressed in answering tht. investigative

question were the essential documentation questions: How is

this process being measured? and Are these "alid

measurements? (11:42)

How is the process measured? This section

describes the functional and pipeline measures used to

monitor and manage the pipeline. It wa6 found that

functional measures were monitored by the Material Control

and MICAP Control sections of base supply and the materials

management sections of the depots. The Material Control and

MICAP Control sections monitored reports reflecting the

supply status and EDDs of the individual requisitions

processed through their sections. Material Control

monitored or'y vehicle requisitions while MICAP Control

monitored all MICAP requisitions from the base, including

463L MICAPs. Both Material Control and MICAP Control

monitored data that helped ensure parts requisitions were

effectively processed through the pipeline.

The materials management sections of the depots

monitored backorder notifications ana fiii Ld s. Backorder

notifications alerted Item Managers (IM) of outstanding or

newly created backorders. The IMs used these reports as

"flags" to initiate actions to resolve stockage problems and

fill parts requisitions. Fill rate reports reflected the

stockage effectiveness of the stocks managed by the

124

individual IMs and depots. These reports were used to

evaluate the performance of depot stocks in filling parts

requisitions.

Pipeline time measures were only monitored by vehicle

maintenance and depot units. The vehicle maintenance

sections monitored the Vehicle-Down-for-Parts (VDP) rates

and times. These rates provided an indirect measure of the

pipeline by measuring the number of hours vehicles were down

for parts, and included 463L specific information. The

depots measured pipeline times for both the pipeline as a

whole as well as the depot specifically. These reports

provided either summary data for the processing times for

all MICAP requisitions, as provided at ALC depots: or

provided summary information for all Priority 01-03 and Not

Mission Capable-Supply (NMCS) items including MICAP

requisitions, as provided at DLA depots. Neither of these

reports provided any specific breakout of 463L requisition

processing times.

Are these measures valid? This section describes

the capabilities and limitations of the pipeline

measurements.

Most of the pipeline measurements used to manage the

463L pipeline were found to monitor only certain aspects of

the pipeline. For instance, the VDP rate provided only an

indirect measure of the spare parts pipeline because the VDP

rate was based on the number of hours 463L vehicles were

down for parts and not on the number of parts required for

125

the vehicle. This meant that if one vehicle were down for

more than one part the VDP rate underestimated the

requirements placed on the supply pipeline.

Depot level performance reports also tended to

underestimate pipeline problems. Fill rates, for example

were used as a measure of the stockage effectiveness of a

depot. The fill rate equalled the percentage of new

requisitions filled from on-hand depot stock. The problem

found with this report was that the fill rate did nct

consider backorder requisitions carried over from the

previous reporting period. This meant the fill rate

understated the total number of parts on backorder at the

depot. As a result, the actual pipeline performance

experienced by the customers was less than the performance

reflected in the fill rate. This illustrated that depots

measured their effectiveness on only part of the pipeline

service provided to the customers, since customers evaluated

pipeline performance on the total number of outstanding

orders, not just the new ones.

Depots also overestimated their pipeline time

performance for a similar reason. Depots evaluated pipellne

processing +imes for only those parts readily available from

depot stockage. If parts had to be backordered, they were

not included in the measurements or reports that were

actually used to evaluate pipeline processing times. Thus

the reports used to manage the pipeline overestimated the

pipeline performance experienced by the users, since from

126

the user's point-of-view pipeline time includes all parts

requisitioned not simply those in depot stocks. From a

customer's viewpoint, then, the average and total pipeline

times were greater than those used to evaluate pipeline

performance.

The difference in point-of-view becomes even greater as

the fill rates for depots fall and less of the total

requisitions are evaluated in pipeline performance.

Pipeline managers must keep this disparity in mind since

"the single output of any organization is custL.ner service'

(10:11).

The common thread through all of these pipeline

performance measurements and reports seems to be, "Tell me

how you measure me and I'll tell you how I behave" (13:1).

Pipeline organizations seemed to have geared their

performance reports to the goals and standards by which they

were evaluated. In most cases, reports and management tools

reflected pipeline performance in terms of the "best case"

situation and reflected only those requisitions that move

smoothly through the pipeline rather than monitoring problem

areas. As a result of these "best case" performance

measurements, the validity of pipeline management tools was

questionable.

Investigative Questions Four. How are processing times

recorded and what reports reflect and summarize these times?

There were only two activities that monitored pipeline

processing times, as listed in Table II of Chapter V. As

127

illustrated in the table, vehicle maintenance indirectly

moi*itored pipeline times through their Vehicle Integrated

Management System (VIMS) PCNO032 report. This provide(! VDP

times for 463L equipment on a monthly summary basis. As

stated in the previous section, VDP times provided only a

limited measurement of the pipeline, as the times recorded

reflect only the number of vehicles down for parts, not on

the total number of parts required. Thus, VDP times hid the

total parts processing times for the individual parts

requisitioned.

The pipeline times recorded by the depots also provided

a limited view of total pipeline pr'ocessing times. As

explained in Chapter V, the pipeline management reports used

in managing and evaluating the pipeline reflected processing

times for requisitions satisfied from on-hand depot stocks.

Requisitions for parts not immediately available for

shipment were excluded from these reports. These reports

included Part 1 of the ALC depot LOG-LO (M) 7922 report and

the MILSTEP Highlight Table for DLA depots.

The other problem with the depot reports for the

purpose of this thesis was that thet did not segment

pipeline times for 463L equipment. As a result, pipeline

time distributions could not be developed for use in

answering the fifth and final investigative question.

Investigative Question Five. What are the average

processing times and time distributions for each section of

the pipeline? How do changes in the times and distributions

128

impact the pipeline? Neither of these questions were

answered in this research because no 463L specific pipeline

times were available from each section of the pipeline.

Pipeline time information either reflected total 463L

pipeline times or consolidated 463L information together

with all other requisitions of equal priority. As a result,

the only 463L specific information available and collected

was presented in the frequency distributions presented in

Chapter V.

The frequency distributions could only be used to

present an example of the total 463L pipeline processing

times available found to be available. None of the

information used to develop the distributions was readily

available. To formulate these distributions required one of

two collection methods: a specific computer retrieval

program to collect the data, i.e. the D165 information

reflecting the total MICAP processing times for the Military

Airlift Command 463L requisitions; or manual source

document-by-source document collection methods.

The frequency distributions illustrated that although

most parts were received within the seven day Uniform

Material Movement and Issue Priority System (UMMIPS)

standard, many required more time and in some cases over 100

days. This indicated there were difficulties in the

pipeline that created long parts delivery times and kept

essential 463L equipment out-of-commission for extended

periods.

129

These longer pipeline times caused field units the most

problems and must be resolved to ensure 463L equipment is

available to support the airlift mission when required.

Further Research

While conducting the research and analyzing the 463L

pipeline a number of areas were found that required further

research. Since this thesis flowcharted the Air Force

pipeline for 463L spare parts, this flow could be compared

to commercial industries using similar equipment. A

comparison of this type would provide insight into the

pipelines developed to support materials handling equipment

in the private sector where every hour a vehicle is

deadlined for parts reduces company profits as well as

customer service. This comparison also may provide insight

into the costs and benefits of fully computerized on-line

order processing systems.

Using the flowchart developed in this thesis also

enables further researchers to assess the actual processing

times required for each section of the pipeline. An

individual or team could physically track individual

requisitions through the pipeline and record processing

times. These times then could be used to develop a

simulation of the pipeline. The simulation (ould be used to

evaluate how changes in each section of the pipeline effect

the pipeline as a whole. The simulation developed could

fully and accurately illustrate the effects pipeline

interactions have on total pipeline performance.

130

Summary

This chapter provided a general overview of research

results concerning the 463L spare parts pipeline by

addressing each investigative questions individually. Of

key importance was the actual evaluation of the information

flow problems and inefficiencies which permeate the pipeline

process. The discussion indicated delays were inherent in

the pipeline because of the use of outdated and indirect

order processing computer systems. The discussion also

restated the problem inherent in the performance measures

used to evaluate pipeline performance. That is, performance

measurements did not reflect pipelineperformance from the

users perspective. The lack of was orientation resulted in

pipeline managers evaluating performance from a narrow

micro-analytical perspective, rather than from the general

macro-analytical perspective professed in Chapter I.

In closing, this thesis presented the initial

documentation and analysis of the 463L pipeline. The

pipeline flows developed and the performance measurements

evaluated indicated the pipeline has inherent difficulties

that must be addressed to enable the pipeline to support

463L equipment in the most efficient and effective manner.

131

Bibli9raphy

1. Bond, Craig, Supply Officer. Personal Interview. AirForce Institute of Technology, Wright-Patterson AFB OH,5 March 1989.

2. Bowersox, Donald J. et al. Logistical Management(Third Edition). New York: Macmillan PublishingCompany, 1986.

3. Coyle, John J. Transportation (Second Edition). NewYork: West Publishing Company, 1986.

4. Department of the Air Force. Aerospace OperationalDoctrine: Combat Support Doctrine. AFM 2-15.Washington: HQ USAF, 13 December 1985.

5. Department of the Air Force. Assignment and Use ofStandard Reporting Designators (SRD). AFR 65-5.Washington: HQ USAF, 25 October 1984.

6. Department of the Air Force. Motor Vehicles:Management of MAC Vehi~les and Equipment at MAC TenantUnits. MAC Regulation 77-2. Scott AFB, IL: HQMilitary Airlift Command, 2 June 1988.

7. Department of the Air Force. Motor Vehicles: VehicleMaintenance Management. AFM 77-310 Vol II.Washington: HQ USAF, 24 April 1987.

8. Department of the Air Force. Supply: SupplyManagement. AFM 67-1 Vol II. Washington: HQ USAF,I October 1988.

9. Emory, C. W. Business Research Methods (ThirdEdition). Homewood: Irwin Press, 1985.

10. Gattorna, John. "Effective Logistics Management,"International Journal of Physical Distribution andMaterial Management, 18: 4-92 (1988).

11. Gitlow, Howard S. and others. Tools and Methods forthe Improvement of Quality. Homewood: Irwin Press,1989.

12. Goldfarb, Oscar A., Deputy for Supply, Maintenance, andLogistics Plans. Memorandum For AF/LE. Department ofthe Air Force, Washington DC, 13 January 1988.

13. Goldratt, Eliyahu M. and Robert E. Fox. "TheFundamental Measurements," The Theory of ConstraintsJournal, 1: 1 (August/September 1988).

132

14. Gomes, Roger and John T. Mentzer. "A Systems Approachto the Investigation of Just-In-Time," Journal ofBusiness Logistics, 9: 71-88 (1988).

15. Harper, Doug. "Strictly For Salesmen," IndustrialDistribution, 76: 58 (March 1987).

16. Harvey, Randolph J. "Carrying the Load," Airlift: TheJoure:_ Iw the Ar1 4 ft f1nP--i nns School, 10: 6-9 (wa1I1988).

17. HavenTree Software Limited. EasyFlow 6.0. HavenTreeSoftware Limited, Thousand Island Park NY, 1989.

18. Helton, Buford, Branch Chief, Materials Support Branch,and Andrew J. Cone, Section Chief, MICAP SupportSection. Joint Interview. Air Logistics Center,Warner-Robins AFB, GA, 26 June 1989.

19. Heskett, James L. and others. Business Logistics(Second Edition). New York: The Ronald Press Company,1973.

20. Holivar, Greg. Chief, Transportation Policy Branch.Personal Interview. Air Force Logistics Command,Wright-Patterson AFB, OH, 4 August 1989.

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24. Manns, Charles S., Supervisor, USAF Expedite Section,Emergency Supplies Operations Center. PersonalInterviews. Defense Construction Supply Center,Columbus OH, 3 May 1989 and 19 June 1989.

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32. Shycin, Harvey N. "The Folly of Seeking Minimum CostDistribution," Logistics: Concepts and Applications.edited by John H. Campbell. Cleveland: LeasewayTransportation Corporation, 1983.

33. Smith, SSgt Jeffery H. and SSgt Damon E. Morris,Material Control Specialists, and Gary E. Huckaby,Chief, Group Control. Personal Interviews. VehicleMaintenance Material Control, Charleston AFB, SC,28 June through 29 June 1989.

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134

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135

Vita

Capt Brett A. Gordon

He entered Officers Training School

soon after graduating from Illinois Wesleyan University.

After receiving his commission he spent six months in

navigation training before becoming a transportation

officer. Since that time Capt Gordon has been an Air

Terminal Operations Center Duty Officer and Passenger

Service Officer at Dover AFB and Chief, Vehicle and

Equipment Division at Seventh Air Force in Korea. Upon

graduation from the Air Force Institute of Technology, he

will be assigned to the 603 Aerial Port Squadron, Kadena AB,

Japan as the Transportation Plans Officer.

136

UNCLASSIFIEDSECUR 'y FLASSIFPCA-iON OF TiS PAGE

Form ApprovedREPORT DOCUMENTATION PAGE OMB No. 0704-0788

la. REPORT SECURTY CLASSIFICATION lb RESTRICTIVE MARKINGSUNCLASSIFIED

2a. SECURITY CLASSIFICATION AUTHORITY 3 DSTRIBUTION/AVAILABILITY OF REPORTApproved for public release;

2b. DECLASSIFICATION /DOWNGRADING SCHEDULE dis tribution unI imi ted.

4. PERFORMING ORGANIZATION REPORT NUMBER(S) S. MONITORING ORGANIZATION REPORT NUMPER(S)

ArIT/GLM/LSM/89S-24

6a. NAME OF PERFORMING ORGANIZATION 6b. OFFICE SYMBOL 7a. NAME OF MONITORING OR6ANIZATIONSchool of Systems and (i Capplicable)

SI AIT/LM

6. ADDRESS kCity, State, and ZIP Code) 7b. ADDRESS (City, State, and ZIP Code)Air Force Institute of Technology (AU)Wright-Patterson AFB, OF 45433-6583

Ea. NAME OF FUNDING/SPONSORING '8b. OFFICE SYMBOL 9 PROCUREMENT INSTRUMENT IDENTIFICATION NUMBERORGANIZATION (if applicable)

8C. ADDRESS (City, State, and ZIP Code) 10. SOURCE OF FUNDING NUMBERS

PROGRAM PROJECT TASK WORK UNITELEMENT NO. NO. NO ACCESSION NO.

71. TITLE (Include Security Classification)

SUPPLY SUPPORT OF AIR FORCE 463L EQUIPMENT;AN ANALYSIS OF THE 463L EQUIPMENT SPARE PARTS PIPELINEI'. PFRSONAL AUTHOR(S),o-rlon, rett A. , B.S., Captain, USAF

13a. ,YPE OF REPORT 113b. TIME COVERED 14. DATE OF REPORT (Year, Month, Day) 1S. PAGE COUNTTHFSIS OI "O 1989 Sentember 148

16. SUPPLEMENTARY NOTATION

17. COSATI CODES 18. SUBJECT TERMS (Continue on reverse if necessary and idcntify ty !?" >o number)

05 SUDPLY PIPELINE15 05 SP'0YE PAPTS VEHICLE SUPPO. 215 0519. ABSTRACT (Continue on reverse if necesary and identify by block number)

Thesis Advisor: Robert F. McCaulev, Major, US.7AFInstructor of Locistics ,Manacerent

for ublic re ease: IAW AFR 190-I.

LARRY W. EMMELHAINZ, Lt C61, USAF 14 Oct 8QDirector of Research and Consultation

Air Force Institute of Technology (AU)

Wright-Patterson AFB OH 45433-6583

20 DISTRIBUTION /AVAILABILITY OF ABSTRACT 21 ABSTRACT SECURITY CLASSIFICATIONM UNCLASSIFIED/UNLIMITED 0 SAME AS ROT C DTIC USERS U NLLASSIFIED

22a. NAME OF RESPONSIBLE INDIVIDUAL 220 TE,-E -ONE (Include Area Code) 22c OF;IC: SYMBOLMa 'obert F. McCauley (513)255-3911 AFIT/LSM

DO Form 1473, JUN 86 Previous edirions are obsolete. SECURITY CLASSIFICATION OF THIS PAGE

UNCLASSIFIED

UNCLASSIFIED

Block 19. Abstract

'Getting the right thing to the right place at theright time," is the goal of a logistics system. With thegoal of the logistics system in mind, commanders andmanagers are now asking, what makes up a logistics systemand how does the system work? This thesis addresses thisquestion by analyzing one of the channels or pipelineswithin the Air Force logistics system, the spare partspip ne cnr 41T. equipment. This pipeline focuses on thispipeline for two reasons: (1) parts availabililty for thesemission assets is essential to the Air Force, and (2)individual pipelines are more managable research topics thethe logistics system as a whole.

This thesis describes through flowcharts and processdescriptions pipeline responsible for processing MICAP spareparts requisitions for 463L Materials Handling Equipment.Pipeline management, measurement, and interactions arehighlighted along with their impact on the function ofpipeline as a whole.

The major outcomes of the thesis research were: (1)detailed flowcharts of the requisition process for 463Lparts from vehicle maintenance through the depots and backto maintenance, (2) no single manager or office controlledor monitored the entire pipeline, (3) many of the keypipeline measurements and management reports monitored onlylimited aspects of pipeline performance and overlooked areasthat detract from the customer service provided by thepipeline, and (4) the order processing computers createdinherent delays in the pipeline because of outdated andindirprt information systems and technology.

Overall, the value of this research was not to identifypipeline problems, but to provide the groundwork for futuremore detailed pipeline and logistics studies.

UNCLASSIFIED